PM Lee Hsien Loong at the SMMWU 50th Anniversary Gala Dinner

NTUC Secretary-General Lim Swee Say
NTUC President John de Payva
SNEF President Stephen Lee
Ministers, Employers, Brothers and Sisters, my Fellow Singaporeans,

I congratulate the Singapore Manual & Mercantile Workers’ Union on its 50th Anniversary.  The SMMWU has a long and illustrious history.  It was started by a humble clerk with six other workers, and over 50 years it has grown to become the largest union in Singapore, with 240 branches and 85,000 members.  Today, it is a key member in the National Trade Unions Congress (NTUC), and a key asset in Singapore’s tripartite partnership.

Unfortunately, the union’s 50th anniversary celebrations have come at difficult time.  An unprecedented storm is sweeping the world.  US, Europe and Japan are in deep recession, and Asian economies have slowed down dramatically.  Even China and India, which had been growing at breakneck rates these past several years, have not been immune from the global downturn.  As a globalised economy, Singapore has been hit as well, and the Government has predicted our GDP to fall by 2% to 5%.  The drop may be even more, if world demand does not recover soon.

The US under a new administration has taken steps to tackle the crisis.  It faces many and very difficult challenges.  In mid-Feb, President Obama got Congress to pass a US$787 billion fiscal package to stimulate the US economy.  On Monday, Treasury Secretary Geithner unveiled a trillion dollar plan to rid banks of their toxic assets.  A few days later, he followed up with far-reaching proposals to overhaul the financial system, and how it is regulated and supervised.  These are aimed at preventing a repeat of the banking crisis which wiped out trillions of dollars of investments. 

So far, the market response has been positive.  But the question is whether these efforts will be enough, or whether they will leave deeper problems unsolved.  For example, if the financial institutions write down all their bad assets, some will probably become insolvent.  They will either need to raise more capital, or wind up.  In that case the US government will have to pump in more money, which will mean asking Congress for more funds.  But the public mood in the US towards banks and bankers is poisonously hostile, made worse by the row over AIG bonuses.  Congress will not readily agree to help banks out with more public money, and make their voters even angrier.  This will make it harder for the US government to take the necessary actions to sort out the problems.  As a result, the problems may become more serious than they need to be, and thus drag out the recession.

G20 Leaders will meet in London next week to discuss responses to the crisis.  We hope they will clearly commit themselves to supporting free trade, and avoiding protectionist moves.  We also hope the Leaders can achieve some mutual understanding, so that countries can begin to work together to tackle this global problem.  For example, when govern ments spend more to stimulate their economies, they should not bring in requirements to buy only from domestic producers, or to exclude non-citizens from working on these projects.  Otherwise, countries will be acting at cross purposes, each trying to protect its own citizens but collectively making things worse for all.  ASEAN will be represented at the G20 meeting through Thailand, the ASEAN Chair, and will hopefully make a contribution to the discussions.

This is the external environment that Singapore has to accept and operate within.  We have always been a price-taker in the world, and we try to make the best out of what we have.  What we can do and have done is to buffer Singaporeans from the worst of the storm, as best as we could.  The Government has taken decisive measures to respond to the crisis.  We implemented SPUR (Skills Programme for Upgrading and Resilience) in December last year and then a major “Resilience Package” in January this year.  These moves are not just to ameliorate the effects of the downturn.  They are also to prepare Singapore for the upturn, so that when the world economy recovers, we will be the first off the blocks.

While these measures have been helpful, the global storm has inevitably affected our workers.  Retrenchments are up sharply, so far mainly in the manufacturing sector.  Service sector retrenchments have accounted for less than a fifth of the total in 2008 and this year.  However, our tourism and transportation businesses have gone down sharply, and airlines, retail, logistics and other sectors have all been hit.  This slowdown must sooner or later impact on employment in the service sector.  Therefore, we must brace ourselves for more job losses to come.

Thankfully, there are also some favourable factors.  Many retail companies had not recruited to their full strength before the crisis hit, and therefore have less need to retrench now.  Some companies in the service sector are in fact still recruiting, e.g. new shops along Orchard Road, and the Integrated Resorts (IRs).  Many jobs are still available.  e2i has 13,000 openings available for job-matching, of which about half are in the service sector.  Workers should take full advantage of these opportunities to find a job even during these times.

As one of the oldest and the largest unions in Singapore, SMMWU has important responsibilities during this downturn.  You must continue to work with companies in your sector to stave off job losses, and in particular, encourage them to use SPUR to upgrade workers.  So far, 735 companies have committed to upgrade 38,000 employees.  You can help to add more companies to the list.  You also have to help workers who lose their jobs, especially to take care of their families.  I am glad that SMMWU is a strong supporter of the U-CARE fund which NTUC is putting together, and is also building up its own funds.  They will be a much needed lifeline for workers who become casualties to the recession.  Finally, you need to encourage retrenched workers and job seekers to go for re-training and accept alternative jobs, which can still be found.

In this depressed job market, workers are taking training and upgrading more seriously.  This gives us an opportunity to improve our service quality, which is critical to the service industries, especially the IRs.  The business of the IRs is to sell a positive holistic experience.  Guests visit the IRs to have a good time and want to feel pampered when they are there.  That is why service is a high priority in places like Las Vegas, and casinos there place strong emphasis on service training and give awards to employees who perform well.  We too must create such a culture of service excellence, if we want our IRs to succeed.

Hong Kong undertook a major effort during the 1997 downturn to transform its service culture.  As a result, service attitudes improved dramatically, service staff became more responsive and there was greater willingness to go the extra mile.  We should similarly use the current downturn to raise our own standards of service.  This is a matter of skills, but also of attitudes and mindsets.  Service staff must to want to help the customer, to understand what he needs, and to solve his problem.  This is not just for the IRs, but throughout our service sector – for retail, hotels, restaurants, public transport, and any enterprise which provides customer service, including our government agencies.

During tough times, it is understandable that people feel anxious and stressed.  They worry about whether they can hold on to their jobs and take care of their families.  In many countries, these concerns show up as social unrest, discontent with the government, and rejection of the outside world, whether it is imports, immigrants, or foreign workers.  The country becomes divided, people react emotionally, and problems become harder to solve.

In Europe, tempers are flaring all across the continent as the economic pain worsens and more people lose their jobs.  As one British psychotherapist said, “People are looking for someone to blame as they feel the crisis on a day-to-day basis and experience feelings of injustice and anger as they ask themselves, ‘What have I done to contribute to this?’”¹. A few days ago, three million people in France took to the streets to protest against President Sarkozy’s economic policy and reform programme.  The scale of the demonstrations shows the level of dissatisfaction and anger in France.  But the protestors offered no alternative plans.  At the end of the day, France is no nearer a solution to the crisis.

In Singapore, we must make the extra effort to stay united through crisis, to think through our problems calmly and rationally, and work together to overcome this challenge.  Our tradition of tripartite cooperation is especially valuable at this time, and we must preserve and strengthen this partnership in this crisis.  We have to work hard to reassure workers: explain what is happening to us, what we are doing about it, and what we can expect over the next few months and years.  We have to channel our energies towards practical and effective measures, like upgrading our workers and building for the future.  If we handle this well, we will pull through and emerge stronger and more trusting of each other, as we have done many times before.  Then together as Singapore United, we shall achieve the best possible outcome for our workers, our businesses, and our nation.

[1] Ms Sheri Jacobson, a psychotherapist who is clinical director of Harley Therapy in London. Quoted in Straits Times, “Outrage in Europe over hard times”, 26 Mar 09.

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