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In response to a parliamentary on SMEs and AI adoption, Singapore's Manpower Ministry added that for businesses displaced by technology, the Government will work with employers to facilitate transitions into new roles through reskilling and workforce transformation initiatives.
Singapore’s Ministry of Manpower (MOM) has responded to Parliamentary queries on how the rapid evolution of artificial intelligence (AI) may reshape the country’s labour market, particularly for small and medium enterprises (SMEs) and fresh graduates entering the workforce. The questions raised were as follows:
- Given that SMEs employ 70% of the workforce, whether the Government can consider conducting a study to better estimate for whom artificial intelligence (AI) is complementary and for whom AI is a substitute for their labour.
- Whether there are differences in these impacts between SMEs and MNCs, so that the Government can implement more targeted support plans for workers whose roles may be substituted.
On fresh graduate hiring and employability
- Whether the adoption of artificial intelligence is prompting employers to slow down the hiring of fresh graduates from Institutes of Higher Learning (IHLs) in certain sectors or occupations.
- Whether the Ministry has plans to help boost the employability of, and opportunities available to, fresh graduates who may face such challenges.
Responding to the first set, MOM said it is studying how AI adoption could either complement or substitute different groups of workers. While SMEs and multinational corporations (MNCs) operate in distinct contexts, with varying levels of resources and organisational capabilities, the ministry noted that AI’s impact depends more on the nature of business activities and job roles than firm size.
As such, workforce transformation efforts are designed to support firms across the board. Programmes focus on job redesign and reskilling alongside AI adoption, with implementation partners tailoring support based on each company’s needs. Firms undertaking larger or more complex transformation projects may receive closer guidance.
The ministry added that it remains committed to helping all workers stay relevant in an AI-enabled economy. For those displaced by technology, the Government will work with employers to facilitate transitions into new roles through reskilling and workforce transformation initiatives.
On concerns about graduate employment, MOM said overall employment rates for fresh graduates from Institutes of Higher Learning (IHLs) have remained broadly stable over the past decade, with fluctuations largely driven by broader economic uncertainty, geopolitical developments, and changing career aspirations of graduates.
To prepare graduates for the changing landscape, IHLs are collaborating with industry partners and sector agencies to update curricula with AI-related competencies, domain skills, and core capabilities such as critical thinking, creativity, and communication. Work-based learning opportunities, including the AI Apprenticeship Programme, aim to help students apply these skills in real-world settings.
"While artificial intelligence, or AI, is reshaping the labour market, its specific impact on entry-level PMET jobs remains uncertain," said MOM.
MOM also highlighted that IHLs are working closely with sector agencies and industry partners to keep their curriculum relevant to prepare graduates for the AI era. This is done through "integrating AI competencies, domain-specific training, and core skills like critical thinking, creativity, and communication."
These efforts are complemented by work-based learning programmes like the AI Apprenticeship Programme, which provide opportunities to apply AI skills in real workplace settings.
Students and fresh graduates are also given access to Education and Career Guidance services within IHLs, alongside career matching and coaching support from Workforce Singapore and NTUC’s Employment and Employability Institute.
Finally, MOM shared, in response to heightened economic uncertainties in 2025, young graduates have the option to tap on the Graduate Industry Traineeships Programme as a means to gain industry-relevant experience and ease their transition into permanent roles.
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