Support Site for The Unemployed & Underemployed
Tuesday January 16th 2018

Singapore’s Fresh Graduate: A New Poor

Singapore’s Fresh Graduate: A New Poor

Submitted by amrc on Thu, 09/13/2007 – 16:56.

By James Gomez

The gainful employment of the Fresh Graduate is one of Singapore’s emerging areas of policy concern. In 2000 the number of graduates without work stood at 6,500. By 2001 the total number of unemployed with tertiary education stood at 20,800 (Labour Market 2001 Report, Ministry of Manpower). That 10,700 of this group were tertiary graduates below the age of 30 means that Singapore’s Fresh Graduates face a grim reality ahead and could become a New Poor.

The Fresh Graduate is likely to have completed his or her studies recently at a local or foreign university. S/he is in the early 20s and comes from a middle-income family (i.e. monthly gross family income between S$2,500 to S$5,000 (US$1 = S$1.8), having been educated locally. The Fresh Graduates or their parents would have taken out loans that require paying back.

The Fresh Graduate, having led a sheltered life, may aspire to lofty goals or bold ambitions for his/her future. S/he expects to graduate from University with at least a basic degree before entering the workforce. S/he is looking towards a job that pays above S$2,000 for new starters. As s/he matures in the workforce, s/he will look for higher pay and better fringe benefits elsewhere if his/her employer cannot meet their salary demands.

The Fresh Graduate sees education and paper qualifications as the leveller of social equity and individual wealth. The ability to excel in studies is justified by the meritocratic ideology of political leaders. The myriad state-sponsored and corporate scholarships further perpetuate meritocracy’s myth of academic achievements as the key to improving one’s destiny and social status.

Fresh Graduates look to further education after gaining a first degree. Ten percent of them have done a Masters, Ph.D, or a second degree straight after graduation without joining the workforce. 60 percent save up while working before going back to school in their late twenties or early thirties for an MBA or doctorate. The remaining 30 percent do not return to school because they are on scholarships, financially burdened, lack academic interest, sufficiently wealthy to have no incentive to upgrade, or a combination of these.

The Fresh Graduate does not aspire to marry and settle down early. S/he places career as the priority and forming a family as secondary. S/he is likely to be preoccupied with carving out a niche upon joining the workforce and sets a deadline of 30 years old to attain his/her goals. But often, the drive for career achievement takes much longer – the majority can only realise such goals in their mid-thirties. As such, most of those who had relationships during their careers only settle down with a partner in their thirties.

The Fresh Graduate is likely to have paid costly tertiary education by bank loans or using parental Central Provident Fund (CPF) to pay. As total fees for local studies amount to around S$20,000 for a three year degree programme, s/he would depend on bank loans/CPF funds that pay up to 70 percent of the total cost less government subsidies. Upon completing his/her studies and obtaining that degree, the debt starts to take its toll. Monthly bank interest rates are chargeable for education loans from the July of the year of graduation. Thus, s/he will want to repay the principal sum in the shortest time to avoid prolonged incidence of prime interest rates.

The Fresh Graduate faces this burden immediately upon graduation. The means of repaying the loan is through employment that pays above S$2,000 per month in order to relieve the parental workload, to repay the loan, to sustain the family, and in some cases to finance the schooling of sibling(s). Worse still, the purchase, maintenance, and fuel costs of private transport as well as paying insurance policies, saps a significant portion of a Fresh Graduate’s earnings.

A rising psychological burden could weigh on the minority involved in relationships. Fresh Graduates who consider getting married are saddled with the usual wedding and housing costs. The property market has seen increasing public housing prices in the last decade as the costs of owning a flat often eat into the CPF and savings of newly-weds. Most are in debt until they reach their thirties (assuming a dual-income family). Coupled with current falling property re-sale prices, the total costs of owning a public housing flat outweigh the benefits from cashing in on the property market.

Other phenomena in Singapore among the Fresh Graduates are issues that affect minority students. Singapore has an ethnic composition of 80 percent Chinese, 14 percent Malay and five percent Indians and one percent Others. Malay and Indian students generally state that they have a tougher time than Chinese counterparts in finding jobs. It is not unusual for minority graduates of local and foreign universities to be long term unemployed while looking for a job in the private sector. They complain that most jobs require prospective applicants to be able to speak Mandarin, the language of the majority.

Many who find employment in the public sector are civil servants, teachers, and uniformed personnel. But competition for civil service jobs is increasing; more graduates turn to it as jobs are shed in the private sector. A small number eventually end in ethnic based welfare and cultural organisations, but the number of positions available here is minimal.

The job market is flooded by young, enthusiastic graduates from polytechnics, local and foreign universities who compete with retrenched and foreign talent for a shrinking employment pie. In the National University of Singapore alone, there are estimated to be 20,000 foreign students. Of these, Malaysians and mainland Chinese constitute one-third each. The recent increase in the number of ASEAN scholarships given by the government reflects an unwelcome preference for foreign talents in a labour market nearing saturation point.

The Fresh Graduate is unhappy with state-sponsored scholarships for foreign students who compete with them in the university as well as the job market. These foreign students have prestigious scholarships with academic cost subsidies and living allowances. Free from any financial obligations, foreign students who graduate together with the Singaporean Fresh Graduate need only work for five years to repay their debts. Those who provide documentary evidence of 100 rejection letters of employment applications are also deemed to have served out their bond.

Mature foreign talent may be useful to certain sectors of Singapore’s embattled economy only. The government’s revised policy of allowing in foreign talents who earn above S$2,500 in monthly pay or hold secondary school (or equivalent) qualifications may not be adequate in distinguishing dispensable foreign talents from the real McCoys. Many foreign talents now undercut the wage market by accepting graduate appointments with less-than-equitable pay. Given a strong Singapore dollar relative to their home currencies, foreign talents have no problem with lowered remuneration in Singaporean terms despite a disparity between their level of expertise and the rewards offered. The Fresh Graduate hence has limited job opportunities for him/herself. Prospective employers thus rather choose ‘value-for-money’ foreign talents, thereby depriving aspiring local graduates of their rightful jobs.

Giving private tuition, doing relief teaching, taking temp/short-term contract jobs, taking enrichment courses and finding money to continue post-graduate education have become common stop-gap measures. The Fresh Graduate faces a private sector that is downsizing and a public sector that practices selective recruitment. Add on the proposed fourth university, the problem may worsen. Job creation has not been able to keep pace with the production of thousands of graduates, undermining the principle of supposed social levelling via qualifications. While only the service industry provides undisputed job openings, it only offers jobs and rewards at the lower-end.

It is an uncertain time for Singapore’s Fresh Graduates. Given the volatile global economy, many will be forced to eat the stale humble pie and become a New Poor.

Number of View: 2048

Reader Feedback

2 Responses to “Singapore’s Fresh Graduate: A New Poor”

  1. [...] Singapore's Fresh Graduate: A New Poor | Support Site for The … [...]

Leave a Reply