Singapore Budget 2025: SGTech's recommendations for AI-driven workforce upskilling and more

While existing government initiatives have made progress in reskilling workers, there is a need for a more coordinated and proactive approach to integrating AI skills into the workplace, the association said.

With Singapore Budget 2025 taking place on Tuesday (18 February 2025), tech association SGTech has put forth some recommendations to address pressing workforce challenges and strengthen the nation’s position in the global technology ecosystem amidst the phase of rapid technological disruption.

The main aim, the association said, is to highlight the need for artificial intelligence (AI)-driven workforce upskilling, stronger small-medium enterprise (SME) support and global talent strategy to sustain Singapore’s competitive edge in the tech sector.

Being uniquely positioned in the current technology landscape, Singapore is able to leverage on its highly skilled workforce and strategic location to play an outsized role in the economy. However, trends namely offshoring, talent migration and widening AI skill gaps are putting the nation at risk of long-term competitiveness. If interventions to tackle these areas are not put forward, Singapore may fall into a cycle where high-value and high-skilled jobs increasingly move overseas. As a result, SMEs will struggle to attract and retain top talent.

After multiple focused group discussions within SGTech’s Talent Steering Committee, the following recommendations have been shared with the Ministry of Manpower (MOM) in an effort to push Singapore to build a global competitive edge through tech-multiplied workforce:

Accelerate workforce upskilling driven by the adoption of AI solutions

There is a need for stronger partnerships between government agencies and industry associations in order to drive AI adoption among SMEs. Although existing government initiatives have made progress in reskilling workers, more coordinated and proactive approaches are needed to integrate AI into the workplace.

With curated pre-approved AI solutions and showcasing real-life success cases, companies can have a better understanding on the practical benefits of AI and be encouraged to invest in digital transformation. Additionally, business consultancy support should be enhanced to help SMEs identify and implement AI-driven productivity improvements.

Alongside the support, structured work-based training workshops have also been proposed to help companies assess and integrate AI solutions effectively.

Strengthen Singapore’s position as Global Talent Hub

An increase in financial support for overseas placements, secondments, and inter-company exchanges has been recommended in hopes to help local professionals gain valuable experiences abroad. SMEs should be supported in this aspect as they often lack resources to carry out such mobility. Initiatives such as a co-funded global talent exchange programme can be one example of a support programme to send employees out of the country and bring in expertise from overseas.

It is also recommended that the nation’s immigration policies to emphasise a skill-based approach instead of placing the focus on academic qualifications and salary thresholds. This shift of focus can plug vital skill gaps in growth sectors. Additionally, local talent developmental programmes can be paired with immigration policies to ensure that the transfer of skills internships, apprenticeships and career conversion programmes.

Increase support for SMEs’ role in tech talent ecosystem

A multi-pronged approach for tech talent to view SMEs as potential employers can be considered to boost talent within the SME sector. Examples of such approaches include apprenticeships and internships should be expanded to provide young professionals more structured learning opportunities in SMEs.

SMEs may also consider co-funded scholarship schemes for polytechnic and Institute of Technical Education (ITE) graduates to further incentivise talents to join SMEs. Apprenticeship-style programmes that offer industry-relevant learn opportunities through government-funded training will be highly likely to encourage more SMEs to take in more talents as well.

Chair of SGTech Nicholas Lee said that these recommendations are about securing Singapore’s position in the next era of global technology leadership. "To achieve such success, we must act decisively to ensure that our workforce remains competitive, our SMEs are empowered, and our talent ecosystem is positioned for long-term success. We stand at a critical juncture, and as a nation ready to future-proof our workforce, we must seize the opportunities we have spotlighted thus far," he added.

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