When one plus one is not two

Election fever is in! (Don’t worry, this is not a political article…) The parties have marked their battle grounds and the hustings have begun. The opposition are trying to make greater in-roads and hope to beat the 2011 general elections results and get more alternative voices into parliament. The opposition talk about job creation, what with Covid19 decimating careers and making people unemployed. In fact, one of the parties mentioned that there are currently 100,000 local professionals, managers, executives and technicians (PMETs) unemployed (the Ministry of Manpower has just corrected that candidate, saying that the number is closer to 40,000), while there are 400,000 foreign PMETs working in Singapore. Their suggestion is to get rid of the foreigners and replace them with the jobless local PMETs. Their point, which sounds logical, is why give our jobs to foreigners, when our locals are unemployed?

While we hope that this is just election rhetoric, one cannot get away from the feeling that they are not the only ones in Singapore who believe this. So, in this article I would like to think about this more broadly and analytically so as to see the situation for what is really is.

THE BASICS OF EMPLOYMENT

At the risk of sounding imperious, we need to understand that employment is, at the heart of it, a demand and supply issue. Yet, the demand is not an aggregate demand, but an individual, specific demand. For example, I am currently (as of this writing) looking to hire a junior digital marketing staff. This is my demand. Now, if you have digital marketing skills and experience, and you know how to create a digital marketing plan, and you know how to execute the plan in a cost-effective way, then you are a match for my demand. You form the supply. However, if you do not have any of such skills and knowledge, no matter how good you are in other job functions, you cannot be such a supply. You will not be able to do the required job, even if you are a locally unemployed PMET. So, while aggregate demand and aggregate supply suggest the interchangeability of factors – that is, take out the foreign PMETs and put in the local PMETs – it seldom is that simple on a microeconomic scale; unless, of course, the local PMET has exactly the same skills as the foreign PMET. And we all know that is not very likely.

PRICE DIFFERENCE

Now, while we are on the subject of economics, let us discuss the elephant in the room – price; or more accurately, wages. Without taking into account the differing willingness to work at different salary levels, each employment situation has its own demand and supply setting. So, when one hires a local PMET at the time of oversupply of such talent, economic factors tell us that wages will fall. When labour supply is tight, wages go up; but when they are loose – as it is now with an alleged 100,000 local PMETs out of a job – wages will fall. After all, if one does not take up a job offer, the employer has many more to choose from. So even if there is an opportunity to plug and play a local PMET for a foreign one, economics tells us that the wage level would not be the same; it might even be LOWER than what the foreign PMET was drawing. Is this something we want for our local PMETs? But I suppose, getting a job at any wage level now, is better than no job, right?

BEHAVIOURAL COMPATIBILITY

This brings me to the next point, behavioural compatibility. Indeed, if there are two candidates with exactly the same technical skills, it comes down to who is more behaviourally compatible with the job. While technical skills predict a person’s ability to do the job functionally, behavioural skills predict a person’s ability to interact with stakeholders. Such skills include communication skills, problem-solving skills, negotiation skills, empathy, commercial and business acumen and the like. These skills are harder to train, though not impossible. More significantly, they differ from one person to another. Even if two people have similar levels of behavioural skills, they still interact differently with others. And since work is a social thing, where we need to interact with others, there is a need to have good behavioural skills. While it is easy to assess the requisite technical skills for the job, it is more difficult to assess behavioural skills, since it is so much more subjective. Hence, we cannot simply plug out one PMET and substitute another for the job.

ORGANISATIONAL COMPATIBILITY

Then there is organisational compatibility. The values of the company, the market it is in, the products and services it offers; these are all important considerations to a person. I know that the undertaking, or funeral, businesses have a difficult time hiring local PMETs. Wonder if they will now join the business since there is an oversupply of them? I also know companies in Tuas (the western tip of Singapore) have a hard time attracting local PMETs to work for them. I wonder if they will now flock to these companies? The truth of the matter is that there are many considerations for local PMETs to ponder over when it comes to taking a job. So even if there are 100,000 out-of-job local PMETs right now, it does not mean that they will take jobs in undertaking, waste management, construction or ship building in Tuas. But the foreign PMETs will grab these jobs since they are a means to an end – to make many times more than they can at home, so that they can provide for a better life for their family. And for this reason, they will endure any form of job “hardship”.

CULTURAL COMPATIBILITY

Finally, there is cultural compatibility. Now, I have heard “horror stories” of foreign PMET managers firing their local PMET staff and filling them with PMETs from their own hometown, village or clan. These should be investigated and severel