SINGAPORE'S ECONOMIC GROWTH : IS IT SUSTAINABLE?

Abstract

This paper examines whether the 7% growth target is sustainable till 2000, and into the early decades (2010, 2020) of the 21th century. As labour is our primary supply-side constraint, we look at the implications of the 7% growth rate on labour requirements in the economy, to see if our indigenous workforce can satisfy this demand. After assessing whether the implied stock of foreign workers is acceptable, we revise the forecasted employment levels and derive the sustainable employment growth rates. On the basis of our past labour productivity performance and that of some OECD countries, we analyse if the required labour productivity to sustain the 7% growth target can be met. We conclude that the projected 7% growth target is sustainable, but only up till 2000. On the basis of 25%-30% foreign worker limit, we project that the sustainable growth target in 2001-2010 is 2.3%-4.7%.