Singapore should start supporting workers before AI disruption turns into prolonged unemployment, Deputy Prime Minister Gan Kim Yong said on Thursday, Aug. 27.
Artificial intelligence and automation could allow companies to “produce more with the same or fewer workers,” Gan said in a speech to the Economic Society of Singapore, changing the relationship between economic growth and employment.
New tasks and roles will emerge, but some existing ones may change, shrink or disappear, he said. Gan cautioned that AI was unlikely to trigger immediate, economy-wide job losses, arguing instead for action while workers still have time to move into new roles.
The warning comes while Singapore’s labour market remains relatively resilient. Preliminary Ministry of Manpower data showed employment, excluding migrant domestic workers, grew by 10,700 in the second quarter, marking a 19th consecutive quarter of expansion. Overall unemployment remained at 2.0% in June.
Retrenchments rose to 4,500 from 3,830 in the first quarter, driven mainly by business restructuring in selected outward-oriented sectors, though MOM said the level remained well below that typically recorded during downturns.
Singapore is pushing AI adoption while AI-linked headcount reductions remain limited so far. In May, Manpower Minister Tan See Leng said an inaugural government survey found about three in 10 firms had adopted AI, while only about 6% of adopters reported reducing headcount. Job redesign and the creation of AI-related roles were more common, and about seven in 10 AI-using firms reported productivity gains.
The latest IMDA enterprise data show adoption rose sharply in 2024. AI use among small and medium-sized enterprises more than tripled to 14.5% from 4.2% a year earlier, while adoption among larger firms rose to 62.5% from 44%. A National AI Impact Programme launched in March aims to support 10,000 enterprises and 100,000 workers over three years.
Gan said potentially exposed roles should be identified early, with “career bridges” combining targeted training, career guidance, job matching and actual placement into work that builds on workers’ existing skills.
“Support must begin before workers are affected,” he said.
That approach closely follows final Economic Strategy Review recommendations released on Aug. 23, which call for earlier support before disruption, career bridges for at-risk workers, earlier retrenchment notification and monitoring of AI’s impact on workers.
Singapore also merged SkillsFuture Singapore and Workforce Singapore into the Skills and Workforce Development Agency on July 1.
Gan said opportunities would also remain in care, allied health, early childhood education, skilled trades and essential services, where judgement, dexterity, trust and human interaction remain important. Technology should make such work more productive while improving career progression and wages, rather than simply preserve jobs unchanged.
Redistribution and social support would remain necessary, Gan said, but productive employment had to stay at the centre of economic policy. Good jobs were not something to consider only after economic decisions had been made.
“They are part of economic strategy itself.”