Who should be retrenched first?

Discussion in The Online Citizen
http://theonlinecitizen.com/2008/12/who-to-retrench-first-pm-vs-labour-chief/#comment-39428

Here are my views about who should be retrenched first - locals or foreign workers?

My answer is: retrenchment should be avoided. If demand drops by 20%, all workers should work 4 days (instead of 5 days) and take a 20% wage cut. The workers who are able to find alternative work elsewhere can resign. This allows the other workers to work more than 4 days and get additional income for the additional work.

How can the worker cope with a 20% cut in wages? They can draw down on past savings. I suggest a new scheme - to allow them to get a relief loan (for the drop in earnings) at a a modest rate (say 2.5% p.a.) for a period of 12 or 24 months. Such a scheme should be set up by the Governmetn as part of a social safety net. This is important in Singapore, in lieu of unemployment insurance.

We should treat our foriegn workers fairly. Many of them take big loans to come to work in Singpaore. We cannot send them back prematurely on an economic downturn.

In the future, we should plan the use of foreign workers carefully. It is better to have long term migrants into Singapore, if we need to increase our manpower and size of the economy.

Tan Kin Lian

Poll: How should a company cope with falling demand in a recession?
Number of replies: 95

Retrench local workers: 5%
Retrench foreign workers: 40%
Reduce the days worked and wages proportionately: 54%