EFFECTIVENESS OF THE GOVERNMENT �S SCHEMES AND REGULATIONS ON CONSTRUCTION FOREIGN LABOUR AND ITS EFFECT ON CONTRACTORS

Abstract

The construction industry in Singapore has typically been a labour intensive industry that employs a lot of unskilled foreign labour from a variety of countries. The wide usage of unskilled labour has hindered the performance of the industry as construction productivity is lowered by these unskilled workers. Although efforts have been made by the government through the implementation of different policies to reduce reliance on foreign labour, the problem still persists today in the industry. This research will only concentrate on construction workers who are physically involved in the construction process and does not include construction professionals. The objectives of this study are to analyze the reasons for the high dependency on foreign construction labour, review the effectiveness of the various schemes and regulations put in place since the 1990s, review the impact these policies have on main contractors and make recommendations to improve the schemes and regulations governing foreign construction labour. The research methodology includes collecting data through surveys, followed by interviews with selected respondents to get a better understanding of the rationales behind the choices of their replies. Through the surveys and interviews, it was found that most of the policies such as the two-tier levy system, man- year entitlements and dependency ceiling do reduce reliance on foreign labour by imposing stricter rules to govern the application of foreign labour. It was also found that contractors react differently to the policies implemented by the authorities. Smaller sized firms are more affected by policies such as the dependency ceiling and they also do not have the financial backing to look into the use of labour efficient construction technology. Policies like man- year entitlement albeit effective in preventing illegal “loaning” of construction workers, poses a problem for contractors as they cannot ensure continuous employment of their skilled workers.