Artificial Intelligence and the Future of Singapore’s Foreign Workforce – The Diplomat

Artificial intelligence technologies are unlocking new economic opportunities in Singapore. Outsizing the city states’ limited manpower, AI is increasing Singapore’s manufacturing output, optimizing customs facilitation, creating new jobs, and spurring innovation.

Though many in Singapore are poised to benefit from the adoption of AI technologies, including automation and robotization, some will not. Low-wage migrant workers, who have long played a critical role in the country’s economy and relationships with its neighbors, are extremely vulnerable to job displacement. As AI automation shifts conceptions of value and expertise, challenges may compound for workers long treated as expendable in the world’s most expensive city.

Concerns about job security in the age of artificial intelligence are ubiquitous. However, Singapore’s ambitions for global leadership in AI have fueled efforts to upskill and future-proof the workforce from these anxieties. Since 2015, Singapore’s proactive SkillsFuture Initiative has provided citizens and residents over the age of 25 subsidized access to thousands of courses and job transition support. In 2023 alone, about 520,000 individuals participated in training programs supported by the initiative. Singapore’s workforce has been the world’s fastest in adopting AI skills.

Singapore’s lifelong learning initiatives have been lauded as an example of inclusive workforce development. Notably, SkillsFuture subsidies are increased for those more traditionally disadvantaged in digital adoption, including older professionals and people with disabilities. However, the exclusion of migrant workers from these programs challenges Singapore’s expressed commitment to inclusivity. Many of these workers already accrue substantial debt from basic training and certification fees needed to work in Singapore, let alone additional expenses to develop digital skills.

Without careful regulations, artificial intelligence will exacerbate socioeconomic divides between workers in Singapore and across the region. Singapore must evaluate its responsibilities to the transnational division of labor as it sets an example for AI adoption. To start, the challenges that AI poses to the region’s low-wage workers must be included in Singapore’s domestic and foreign policy discussions.

Of the city-state’s 1.4 million foreign workers in 2019, 999,000 were low-wage work permit holders. With the prospect of higher wages in Singapore, workers from South and Southeast Asia move to the city state for roles in construction, manufacturing, shipping, services, and domestic work. Migrant workers fill crucial gaps for jobs that resident Singaporeans see as undesirable, accounting for about one out of three low-wage service jobs in Singapore. This relationship allows Singapore to hold its unemployment rate steady even as labor demand ebbs and flows — taking in migrant laborers when they are needed and sending them home when they are not.

The COVID-19 pandemic was a harrowing display of the exploitative nature of this cycle. With economic uncertainty, border closures, and spikes in xenophobic sentiment, foreign workers were the hardest hit by country-wide unemployment. In total, 181,500 foreigners in Singapore lost their jobs at the height of the pandemic — far exceeding foreign unemployment during prior financial crises. With tightened restrictions on foreign work permits, many migrant workers suddenly had to uproot their lives and leave the country. During this period, those classified as “low-skilled” foreign workers made up 76 percent of job losses.

Technological adoption spurred by the pandemic may render some job losses permanent. A joint survey by Microsoft and IDC Asia Pacific found that nearly three quarters of Singapore’s firms accelerated their pace of digitalization due to COVID-19. At the same time, Singapore increased its deployment of AI-powered robots, particularly in sectors normally occupied by migrant workers. To keep up with these changes, it is estimated that Singapore needs 1.2 million additional digitally skilled workers to join its workforce by 2025. As a result, many more may be forced to leave Singapore’s workforce.

Oxford Economics estimates that each new industrial robot wipes out 1.6 manufacturing jobs, with the least-skilled regions of a country doubly as affected as higher-skilled regions. As the second most robot-dense country in the world, the socioeconomic impacts of robotization are substantial. Singapore now has 730 industrial robots per every 10,000 employees, with an average 27 percent increase each year since 2015. During this same period, employment in Singapore’s manufacturing sector decreased every year, even as Singapore’s manufacturing industry grew. The seemingly inverse correlation between employment rate and economic output underscores a shifting valuation of manual labor in Singapore.

Artificial intelligence may exacerbate the dehumanization and devaluation of migrant worker contributions to Singapore. For workers, this may result in lower wages and worse standards of living and employment. Conditions for migrant workers in Singapore are already subpar. Migrants from India and Bangladesh make one-sixth of the average Singaporean salary, and during the COVID-19 pandemic, segregated dormitories for Singapore’s foreign workers received international attention for their deplorable state.

Singapore’s changing labor demands also impact neighboring countries. According to Singapore University of Social Sciences economist Walter Theseira, when jobless migrant workers return home, they bring the societal costs of unemployment with them. These challenges are exacerbated for even poorer populations in source countries. Working experience in Singapore could give former migrant workers an advantage for employment in their home countries, which might displace those who never had the funds or opportunity to leave.

Singapore undermines its commitments to narrowing the development gap among member states of the Association of Southeast Asian Nations (ASEAN) and leading inclusive AI adoption if it does not address its role in the looming wave of transnational unemployment. The global push for AI regulation-setting is an opportune time for Singapore to introduce reforms for ethical, responsible, and mutually empowering labor migration.

The first change is sociocultural. With AI automation redefining productivity, it is more important than ever for Singapore to distinguish an individual’s economic contributions from their personal skill and success. After all, one in five migrant workers are employed as foreign domestic workers, making invaluable contributions to the care of Singaporean families despite little economic acknowledgment or compensation for reproductive labor.

The language of “low-skilled” to describe work that requires little to no professional training devalues social and vocational contributions of Singapore’s lowest paid workers. A preoccupation with efficiency may distort conceptions of what it means to be human and what it means to be Singaporean in the digital age. A notable example is Singapore’s centuries-old hawker culture, which is at high risk of disappearing as more youth aspire to become professionals, managers, executives, or technicians (PMETs) in Singapore. Rethinking Singapore’s “low-skilled,” “semi-skilled,” and “high-skilled” labels can reverse dehumanizing perceptions and practices toward foreign workers as well as foster a more constructive society-wide relationship with artificial intelligence.

Second, Singapore should push to safeguard rights for AI-affected migrant workers in Southeast Asia. One worker rights organization proposes that Singapore establish a buffer period for displaced workers to find a new job before facing deportation. Setting an ASEAN-wide standard could help protect workers on every level of the intraregional labor market.

Additionally, Singapore should lead research efforts to examine how AI will influence job displacement and skill demands in the region. Regular reports on these trends can prepare the integrated economies for potential labor supply shocks, while also informing working-age individuals on how to enhance their competitiveness in line with the bloc’s longer-term digital economy goals.

While these initiatives might offer greater benefits to worker-sending nations than to Singapore, taking leadership on ASEAN-wide labor rights could signify that Singapore recognizes the contributions of foreign workers to the city-state’s success story. This generates potential to enhance Singapore’s relationships with its neighbors, address past controversies regarding worker rights violations, and position Singapore as a leader in both AI and its ethical adoption.

As Singapore integrates artificial intelligence technologies across its economy, the rights and future of Singapore’s low-wage migrant workers will become an increasingly pressing issue for Southeast Asia. The international community must pay attention to how Singapore’s decisions set a precedent for AI in the global landscape of labor.

This article was originally published on New Perspectives on Asia from the Center for Strategic and International Studies and is reprinted with permission.