Jul 02, 2024On March 4, 2024, the Singapore government announced significant adjustments to the Employment Pass (EP) policy. Effective from January next year, the EP salary threshold will rise from SGD 5,000 to SGD 5,600 per month. Notably, for the financial services sector, the threshold will increase to SGD 6,200 per month. This article aims to analyze the background and implications of this policy change and provide strategic advice for affected clients.
In response to evolving wage trends in the labor market, the EP salary threshold, aligned with the top one-third of local salaries for professionals, managers, executives, and technicians (PMETs), will be raised by SGD 600, from SGD 5,000 to SGD 5,600 per month, starting January next year.
The rationale behind this adjustment includes reflecting natural wage growth, ensuring fair competition between local and foreign workers, and raising standards to attract higher-caliber foreign talent to support Singapore’s economic development.
In September last year, the Ministry of Manpower implemented the Complementary Talent Assessment Framework. This framework requires foreign applicants to score at least 40 points in various categories such as monthly salary, educational background, company diversity, and local hiring support to qualify for the new Employment Pass.
As of June last year, there were 197,300 EP holders in Singapore, exceeding pre-pandemic levels of 2019. For mainland Chinese clients, this policy adjustment signifies higher economic costs, both during the EP application process and in maintaining their professional presence in Singapore.
Mainland Chinese clients across different ages and professional backgrounds must reassess their career plans and immigration strategies to align with the new policy. For instance, young professionals may need to focus on skill enhancement and career development to meet the higher salary requirements.
With the new policy’s imminent enforcement, it is crucial to complete EP applications promptly and to plan for the long term, thereby mitigating potential impacts from future policy changes.
Under the new policy, establishing a business and securing status through self-employment becomes a viable strategy. This approach offers greater career flexibility and may help meet the new salary thresholds.
In the dynamic policy environment of Singapore, mainland Chinese clients should plan long-term career development strategies, including enhancing market competitiveness through continuous education and skill improvement.
The adjustment of Singapore’s EP policy presents new challenges and opportunities for mainland Chinese clients. By understanding the policy background, analyzing its impacts, and adopting appropriate strategies, clients can navigate this evolving landscape effectively. We hope the analysis and recommendations provided in this article will offer valuable insights.
