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I have quite a different take on this, with the caveat that I am looking at this from the point of view of hiring a white collar worker.
In my experience, CPF has never been a deterrent in hiring a Singaporean over a foreigner.
Lets say you are looking for a staff to support you - will you hire someone simply based on the salary? I would assume that, following the principle of value investing, you will look for the best resource you can find, at a reasonable price. I wont say cheapest price, because if its a capable person, he / she wont come cheap.
I run a small business in the professional services space, and when I hire, I hope to hire someone most suited for the job, at a wage that the business can justify.
A minor correction to the points raised in the two posts: To hire a foreign worker, you need to pay the foreign worker levy which can be around 10% of the salary. When you factor in the hassle of getting the work permit / e-pass, the savings you get vs a 16% CPF is not significant enough to entice me to hire a foreign worker over a Singaporean.
Frankly I prefer to hire a Singaporean because that person is more rooted to the country, and is easier to assimilate into the work culture. A huge consideration is that the foreigner is looking to use your offered employment as a stepping stone into a larger organization in Singapore, which is quite common, and is a far bigger consideration for me than the savings in CPF.
As an employer, I dont feel that the environment biases me towards foreigners. Perhaps the environment is different in other sectors. I do note, however, that we are operating in a global environment, and talent is highly mobile. Talented foreigners may be coming here to take our jobs, but talented Singaporeans are also going elsewhere to take others' jobs...
In my experience, CPF has never been a deterrent in hiring a Singaporean over a foreigner.
Lets say you are looking for a staff to support you - will you hire someone simply based on the salary? I would assume that, following the principle of value investing, you will look for the best resource you can find, at a reasonable price. I wont say cheapest price, because if its a capable person, he / she wont come cheap.
I run a small business in the professional services space, and when I hire, I hope to hire someone most suited for the job, at a wage that the business can justify.
A minor correction to the points raised in the two posts: To hire a foreign worker, you need to pay the foreign worker levy which can be around 10% of the salary. When you factor in the hassle of getting the work permit / e-pass, the savings you get vs a 16% CPF is not significant enough to entice me to hire a foreign worker over a Singaporean.
Frankly I prefer to hire a Singaporean because that person is more rooted to the country, and is easier to assimilate into the work culture. A huge consideration is that the foreigner is looking to use your offered employment as a stepping stone into a larger organization in Singapore, which is quite common, and is a far bigger consideration for me than the savings in CPF.
As an employer, I dont feel that the environment biases me towards foreigners. Perhaps the environment is different in other sectors. I do note, however, that we are operating in a global environment, and talent is highly mobile. Talented foreigners may be coming here to take our jobs, but talented Singaporeans are also going elsewhere to take others' jobs...
(09-06-2014, 02:13 PM)thefarside Wrote:(09-06-2014, 01:57 PM)funman168 Wrote: Pls do not forget that if non-citizen are exempt from contributing to cpf, they will be "cheaper" than us by abt 20%. Who do you think the local companies will prefer to hire?
Assuming that all unit labors are equivalent and that you can interchange people and jobs with perfect matches, yes I agree that the non-payment of CPF by foreign talents will disadvantage Singapore citizen workers, and 20% is a significant number.
I am happy to pay higher cost for everything, if the government is willing to step up and put everyone into the same system (i.e. CPF). Does that solve the issue? How about the following questions:
1. Why are they having the same interest?
2. Why are they allowed to take out the money when leaving?
3. Why are they matched the same 16% as citizens?
4. Why are their contributions tax deductible for employers
5. Why are they allowed to invest in the same non-CPF instruments as citizens?
How about just taxing all companies 20% extra for all foreigner headcount? I think that's a great idea that will completely level all playing fields between Singaporeans and foreigners. Actually something like 40% would be good as well because that accounts for the tax differences between some foreign jurisdictions and here - after all they are all having a great time sheltering under Singapore's low tax system and sucking high salaries while being here.
Everybody will pay; maids, childcare teachers, bangalas, whatever - you name it the government will tax it.
Then distribute all the proceeds into the CPF accounts of Singaporeans (citizens only, PR not included) as extra interest. Kill two birds with one stone - great solution?