Jiang Haolie (right) and volunteer Jensen (middle) chat casually with a worker at Cochrane Recreation Centre, asking if he’d be willing to sit for a slightly longer interview

For about 18 or 19 months until November 2021, Singapore’s borders were largely closed to migrant workers because of Covid-19. There were a few pilot schemes in the middle of 2021 to bring in some workers under very restricted conditions, but the numbers allowed in were nowhere enough to replace the tens of thousands who had left Singapore since Covid-19 began.

Even as borders remained closed, the construction industry was allowed to resume work on their suspended projects starting from around September 2020, quite soon after the worst of the pandemic’s effects on worker dormitories had passed. However, without significant numbers of incoming workers to replace those they had lost, the industry experienced a severe manpower crunch which would last for over a year.

The numbers below illustrate the problem. Prior to the Covid-19 pandemic, Singapore usually had between 360,000 – 370,000 foreign Work Permit holders in the Construction, Marine and Process (CMP) sectors – of which the construction sector had the largest number of workers (we estimate >80%). But at the end of 2020, this number had shrunk by about 60,000 men to 311,000. There was no real improvement through 2021; in fact it probably went down further by the middle of that year before climbing up a little again by December 2021.

Starting around November 2021, border controls were progressively relaxed to allow migrant workers in, but it would be months before the workforce returned to pre-pandemic strength.

In that period (late 2021, early 2022), we heard some interesting stories from workers about being able to get their new jobs without having to pay agents’ fees or other recruitment costs. It wasn’t an across-the-board phenomenon. It was just that we were hearing more of such stories than before, when there used to be a numbing monotony in the tales of debt burdens and financial woe. Prior to Covid-19, having to pay high recruitment costs was so common, workers could hardly believe a job was real unless a hefty sum was asked for.

We thought it was interesting that even with only a trickle of workers coming in, we were hearing a number of “no need to pay” stories. There was even one worker who told us that there was a “sign-on bonus” of $100. TWC2 had never heard of this before. Imagine, employers paying workers to come work for them!

On the other hand, there were still stories in early 2022 of high recruitment costs, shady agents and employers demanding kickbacks. One new kickback was the salary deduction that companies would make to recover the cost of quarantine for incoming workers.

So, what we saw in early 2022 was a rather complex picture. The former situation where high recruitment costs were almost the norm seemed to have been destabilised – almost surely by the sea change in bargaining power, springing from the loss of so many workers during the pandemic.

A quick study

TWC2 decided to do a quick study before this phenomenon petered out – and we knew it would peter out once borders fully reopened. Volunteer Jiang Haolie got together a small team to do some qualitative interviews with workers to understand their pathways to Singapore. To fit the purpose of the exercise, they selected only those workers who flew into Singapore and joined a new job after November 2021. Workers who transferred from one job to another locally were excluded, because there were additional factors involved in transfers which might complicate our findings.

Some of these selected interviewees were here for their very first jobs, while others were returnee workers, coming back to Singapore for their second, third or subsequent jobs. Haolie’s team took care to understand, in each interviewee’s case, how exactly they got from there to here and how much was paid to whom. To the last point however, we cannot expect precision, because very often the worker pays a lump sum to one person who may then pay others (the worker would not know the details).

The point that Haolie and his team members make in their conclusion is that there is nothing immutable about a system in which migrant workers have to pay heart-stopping sums to get jobs in Singapore. Border closures and a net loss of workers gave us a natural experiment to demonstrate what might happen to recruitment costs when bargaining power changes.

Much of the discourse about how to stamp out exorbitant recruitment costs tends to centre around regulating agents effectively and promoting ethical business behaviour by employers. What our study shows is that, necessary though regulating agents may be, correcting asymmetrical bargaining power can go a long way to the same end.

The study (which can be downloaded using the tab at right) therefore spotlights the question why Singapore’s political economy allows (prefers?) grossly asymmetrical bargaining power to persist; why regulators do not pay more attention of the features of the migrant labour market that so disempower workers to the extent that they become victims of exploitation.