RECRUITING the right talent remains the top concern for technology firms in Singapore, going by the latest Annual Business Survey by industry association SGTech, formerly known as the Singapore Infocomm Technology Federation.
Of 164 firms it surveyed last December, 67 per cent cited recruiting the right talent among their top five concerns in the next 12 months.
This was also the top concern in the previous year's survey, when it was cited by three-quarters of firms. Firms chose out of 15 options in the survey, compared to 12 previously.
Manpower constraints were the top challenge faced in the preceding 12 months, cited by 85 per cent of firms in the latest survey.
SGTech chairman Saw Ken Wye acknowledged government efforts to alleviate the talent crunch, including training initiatives such as the TechSkills Accelerator, but added: "However, the impact of these initiatives will be gradual and take time."
Firms' concerns over a lack of talent - particularly in tech-related areas - have surfaced in the run-up to and during the Budget season. In last week's Budget debate, Member of Parliament Foo Mee Har suggested relooking foreign labour policy, warning that a shortage of skilled talent could constrain Singapore's push for economic transformation.
"Many firms complain that they are not able to embrace the push for companies to go digital and adopt new technologies, amid a severe tech talent crunch," she said.
The SGTech survey covered technology providers and users, with users making up a quarter of respondents.
For both groups of firms, the top two challenges to technology adoption were high costs and manpower capability constraints, with each cited by over a fifth of respondents.
However, in the Committee of Supply debate for his ministry on Monday, Minister for Manpower Lim Swee Say said the tight Employment Pass (EP) policy should not be an issue for most foreign professionals with skills in high demand globally and in short supply locally, such as AI (artificial intelligence) and data analytics.
As long as employers comply with the requirement to give fair consideration to local professionals, managers, executives and technicians, they should generally be able to obtain approval for EP applications, he added.
Mr Lim also gave details of the new Capability Transfer Programme, which funds up to 70 per cent of costs - or 90 per cent in exceptional cases - for getting overseas experts to transfer skills and knowledge to local staff. Some tech firms, however, may want to bring in foreign talent in categories below the EP salary level.
"It is no longer easy to bring in general talent at the S Pass level," noted Mr Saw, who added this means employers need to ensure they have a strong Singaporean core. The government's position on skilled manpower has been clear, he said: "Companies understand the constraints and would need to work within them."
Other top challenges that tech firms faced in the previous year were finding market opportunities and making their business more effective. A quarter of firms had flat or negative turnover growth in 2017; almost four in 10 had flat or negative growth in net profit.
This year, other top concerns besides manpower are increased competition and a slowdown in the economy, but firms are optimistic; more than nine in 10 expect positive turnover growth this year and almost nine in 10 expect positive net profit growth.
Data analytics, AI and cyber security are the top three areas in which tech firms plan to invest this year.