Staff Training Programmes to Help Local Micro Businesses Offset Increased Manpower Costs Due To PWM

7 Ms Carrie Tan asked the Minister for Manpower (a) whether there are any manpower training programmes tailored for local micro businesses with less than six employees, such as minimarts, to create real business value to the business owners that offset their increased manpower costs incurred by the Progressive Wage Model (PWM); and (b) whether the Ministry will consider targeted PWM exemptions or adjustments for these micro businesses to help alleviate their business costs.

The Senior Minister of State for Manpower (Mr Zaqy Mohamad) (for the Minister for Manpower): Mr Speaker, the Government recognises that businesses may be concerned about rising costs, including wage increases under the Progressive Wage Model (PWM).

PWM uplifts lower-wage workers through sustainable wage increases, as well as career and training progression pathways to raise their value add to employers. Each PWM role comes with a list of training modules endorsed by the sectoral Tripartite Cluster.

Under the Workfare Skills Support (WSS), all employers, including micro businesses, who send eligible lower-wage workers for such training may receive absentee payroll of up to 95% of the trainee's basic hourly salary, capped at $13 per hour.

Besides training their workers, businesses can redesign jobs and transform their business models to improve productivity. For example, they can tap on the National Trades Union Congress' (NTUC's) Company Training Committee (CTC) Grant, which supports businesses by co-funding their transformation projects to raise productivity, to redesign jobs and to improve work prospects.

To help employers adjust to PWM wage increases, the Government has introduced the Progressive Wage Credit Scheme (PWCS), which co-funds wage increases given to eligible lower-wage workers. Wage increases were co-funded up to 75% in 2022 and 2023, and up to 50% in 2024. For 2025 and 2026, PWCS will co-fund eligible wage increases by 30% and 15% respectively. This helps businesses cope with the impact of improving the wage outcomes of our lower-wage workers over a five-year period.

Mr Speaker, uplifting lower-wage workers is a whole-of-society effort. Beyond improving wage outcomes, we must also ensure that our lower-wage workers continue to be productive in their respective sectors and have meaningful employment through upskilling under PWM. Businesses must also transform and become more productive, such as through better technology and processes. Employers can tap on the Government measures mentioned to support their business transformation, upskill their workers and defray wage increases.

Mr Speaker: Ms Carrie Tan.

Ms Carrie Tan (Nee Soon): I thank the Senior Minister of State Zaqy for his answers. I would like to enquire whether in the Ministry of Manpower's (MOM's) design of the workplace, skilling and training programmes, were micro businesses, such as the minimarts and their associations, consulted and involved in understanding what are the kinds of skills that their workers will need that will create real value-add to their businesses?

And while I am appreciative of PWCS, will MOM consider extending micro businesses with a longer timeline of credit subsidies so that they can have a better chance of transforming their businesses into something that is more relevant for the current economy?

Mr Zaqy Mohamad: I thank the Member for her questions. On the first question, when it comes to micro businesses and businesses in general affected by PWM and other schemes, there are the Industry Transformation Maps (ITMs) through which the Ministry of Trade and Industry and Enterprise Singapore are actively engaging many of our micro businesses, small and medium enterprises (SMEs) on how to tap on the Government schemes, whether it is the Productivity Solutions Grant or other schemes that are relevant for them, to enable them to transform and help workers.

Having said that, I do understand that not every hawker or retailer may understand the schemes. But rest assured that if they wish to, the SME Centres can support them, if they request such assistance. At the same time, I just want to assure the Member as well that there are schemes, such as the Enabling Employment Credit, which provides support or even defrays the cost of up to 20% of an employee's salary if they are persons with disabilities or others who require help.

So, we do have schemes to support, including even the hiring of seniors, for example, because we know many of them are also in some of these micro businesses. Rest assured that help is at hand and overall, the Government provides the PWCS. We understand that with the increase in salary or wages that we hope and want to be an outcome of PWMs, that employers are supported, costs are defrayed. Certainly, this is one way in which the Government, too, wants to support our lower-wage workers through businesses, by giving them meaningful employment.