After more than a decade of high growth, the construction industry has slowed down. Notwithstanding the acceleration of several large government infrastructure projects, the construction industry, like the rest of the Singapore economy, is in for a very challenging time. Various cost-cutting measures have been proposed, from a reduction in CPF contributions to cuts in government taxes, levies and fees. Parliament will debate these recommendations shortly. This evening, I would nonetheless like to touch on one crucial ingredient for competitiveness, namely, productivity.
Productivity is especially critical in a labour-intensive industry like construction.
It must be hoisted to a higher platform. For many years now, the cheap and abundant supply of foreign workers has resulted in an unproductive construction sector. Notwithstanding the two-tier levy differential for unskilled and skilled construction workers, the construction industry has paid nominal attention to upgrading productivity and workers skills. Pre-occupied with meeting the voluminous contracts filling up its order books, the industry ignored any serious attempt at upgrading construction practices and raising labour productivity. The current slowdown would therefore have a salutary effect if it succeeds in awakening the industry to address these long-overdue issues.