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Managing the talent dilemma in the life sciences sector

2015 will be the year when Singapore’s calibrated foreign labour policy takes full effect with further cuts in the quota system, called the Dependency Ratio Ceiling. The government’s ultimate objective is to reduce dependency on foreign talent, build a sustainable local labour pool and boost productivity over the long term.

2015 will be the year when Singapore’s calibrated foreign labour policy takes full effect with further cuts in the quota system, called the Dependency Ratio Ceiling. The government’s ultimate objective is to reduce dependency on foreign talent, build a sustainable local labour pool and boost productivity over the long term.

However, the reality is that job vacancies have gone up, business costs such as wages have increased due to the competition for limited talent, and productivity has not gone up as expected.

Let’s look at the rapidly expanding pharmaceutical and life science industry as a case in point, although the manpower crunch also affects many other industries in varying degrees. According to the Economist Intelligence Unit’s 2015 Healthcare report, Singapore’s strong intellectual property laws and well-developed trade links have attracted substantial investment from research-based pharmaceutical companies, including GlaxoSmithKline, Pfizer, Baxter, Lonza and Roche.

With more companies setting up base here, the same report found that biomedical firms manufactured S$25 billion worth of products in 2013, up from S$5 billion in 2000; and pharmaceutical exports amounted to S$10 billion in 2013.

Singapore is thus seen to be well-placed to become Asia’s Innovation Capital in the Pharmaceutical and Life Sciences arena, but the lack of certain specialised skillsets within the local labour pool poses a major challenge and dilemma to further growth and development of the industry.

HELPING THE INDUSTRY GROW

At the moment, companies have expressed interest to tap on Singapore’s excellent tax incentives, infrastructure and world class environment for research and innovation to grow and expand in the region. But the mismatch between demand and supply for the right talent foils their plans.

The tight foreign labour policy and attrition of existing talent to other newly developing biomedical and pharma hubs in the region further accentuates this challenge. This is forcing some organisations in the pharmaceutical and life sciences industry to recalibrate their growth plans in the context of this new reality.

Although the government is investing heavily to nurture the development of skilled and specialised talent in these industries (medical technology innovators, medical device regulatory affairs specialists, clinical researchers, specialised R&D scientists etc), there are still positions where there is a lack in suitable local manpower. Perhaps it would be prudent to introduce certain temporary measures to lessen the impact of talent shortage so that growth is not impeded.

On its part, the government has heavily invested in upskilling the local labour force and increasing the supply of talent. For example, the Economic Development Board is working with the Workforce Development Agency (WDA) to train people under the Biologics Overseas Skills Training programme. The Agency for Science, Technology and Research (A*STAR) Science Awards (in collaboration with the polytechnics), A*STAR scholarships, investigatorship programmes and other initiatives have been launched to encourage Singaporeans to pursue research as a career. Many industry forums are collaborating with government bodies, academia and research institutes to develop training for pharmaceutical and life sciences industry professionals.

The initiatives have resulted in the successful grooming of close to 45,000 R&D personnel (including researchers, postgraduate students, technicians and support staff) over the past five to six years. About 65 per cent of this population comprises PhD/Masters/Bachelor degree holders deployed in both the private and public sectors . A*STAR scholarships and other academic initiatives and research opportunities have also started reaping benefits by attracting overseas Singaporeans back home.

All these initiatives and many others will hopefully help to address the local manpower supply and demand gap, but it will take a few years to truly have an impact.

Given this scenario, perhaps the government could show more flexibility in the employment of foreign talent on a sectorial basis or for specific companies for their short term needs. This same view was also voiced by Mr Ho Meng Kit, Chief Executive of Singapore Business Federation (SBF) recently at a pre-Budget 2015 roundtable jointly organised by the SBF and PwC Singapore.

It is especially critical in the case of the pharmaceutical and life sciences industries where the trend is rapidly moving from broad-based research and development to focus on more innovative research for niche products and services which require a particular type of skilled specialist that may not be available among the local workforce.

In the meantime, it is prudent for organisations in the pharmaceutical and life sciences industries to make the best of what is currently available, optimise their operations to improve productivity while continuing to look for innovative ways to develop and retain talent.

Open-innovation platforms such as InnoCentive and Kaggle are gradually changing the way pharmaceutical businesses conduct research where scientists across organisations come together to solve problems and form ideas on innovative solutions. Similar models could potentially be considered for collaboration and crowd-sourcing across the industry to address manpower challenges.

Interestingly, PwC’s 17th Global CEO Survey showed that 43 per cent of CEOs in the Pharmaceutical and Life Sciences industry have started taking steps to revamp their talent strategies by embarking on internal change programmes aimed at optimising their existing talent pool through operating model changes such as restructuring their organisation and consolidating into shared services/ hubs, and streamlining of processes. CEOs are also looking at developing their high potential employees by investing in improving their capability. This involves competency based training, leadership training, and involving them in projects to improve productivity. Such change programmes can also include productivity initiatives like re-looking at time spent on each job, redesigning job scope to make them more effective, and implementing technology to reduce dependence on human resources.

ABOUT THE AUTHORS:

R Raghunathan is Management Consulting Partner and Neetha Nair is Senior Manager at PwC South East Asia Consulting.

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