Singapore’s talent pivot: Why firms are turning to South Asia for hiring

For decades, Singapore has been regarded as the business hub of the Asia–Pacific region, supported by a strong global business environment, a vibrant entrepreneurial ecosystem, robust capital inflows, and favourable corporate taxation.

Yet this success has led to a growing constraint. Despite GDP growth of 4.8%¹, Singapore faces a shrinking talent pool driven by an ageing population and shortages in emerging skills such as artificial intelligence, the green economy, and healthcare. With unemployment at just 2.0% overall and 2.8% among residents², the domestic labour market offers little capacity for rapid workforce expansion.

As a result, Singaporean companies are increasingly hiring across South Asia to meet their talent needs. India leads international hiring, followed by the Philippines, Malaysia, Indonesia, and Vietnam — reflecting a strategic shift toward accessing specialised, scalable, and cost-effective talent across the region.

This article examines how Singaporean companies can tap South Asian talent to support global expansion, skill-based hiring and sustainable scaling while drawing upon the actionable insights from Multiplier’s recent webinar on international hiring for Singapore companies with:

• Dennis Ng, Founder & Executive Chairman, Embed Financial Group Holdings
• Liying Lim, VP of Sales (APAC) at Multiplier

What’s driving the hiring shift

Singapore’s success as a global business and innovation hub has outpaced the capacity of its local labour market. As the economy matures and demand for specialised skills accelerates, the limits of a purely domestic hiring model are becoming clear. What was once a cyclical talent tightness is now a structural challenge, reshaping how companies think about workforce planning.

The sections below examine the forces driving this shift — from labour market imbalances and demographic pressure to policy changes that are actively widening Singapore’s global talent funnel.

1. A structurally tight labour market and shifting demographics

Singapore’s hiring challenge has moved beyond short-term cycles and become a long-term structural reality. According to the Ministry of Manpower’s (MOM) 3Q 2025 report, the job vacancy-to-unemployed person ratio stands at 1.49, signalling that demand for talent consistently exceeds local supply.

At the same time, a Net Employment Outlook (NEO) of +15% shows that employers still intend to hire — but struggle to find the right skills rather than open roles. Demographic ageing intensifies this mismatch. By late 2025, resident labour force participation fell to 67.9. Even with the retirement age rising to 64 in July 2026, companies increasingly look to younger regional talent pools to sustain operations and manage wage pressure.

2. Demand for specialised, scalable talent outpaces local supply

As a regional innovation hub, Singapore generates outsized demand for deep-tech skills in artificial intelligence, cybersecurity, and cloud architecture. Local graduation pipelines cannot keep pace. Surveys show that 83% of Singaporean employers struggle to find the talent they need, with IT and data roles reporting the highest scarcity at 81%.

This local scarcity is driving a massive shift in recruitment strategies globally. As Multiplier’s Global hiring gap report shows, 46% of companies are now expanding internationally specifically to secure these hard-to-find skills.

To close this gap, firms actively tap South Asia’s technical workforce. India alone produces more than 1.5 million engineers annually, offering scale, specialisation, and enterprise-grade experience. These professionals support complex global systems while allowing Singapore-based teams to remain lean and strategic.

3. Tech skills bonus speeds up global hiring

Singapore channels foreign professional hiring through the COMPASS (Complementarity Assessment Framework), a points-based system that determines Employment Pass (EP) eligibility. The framework scores candidates across four core criteria — salary, qualifications, diversity, and local workforce support — alongside two bonus categories.

Under the updated 2026 framework, roles on the Shortage Occupation List (SOL) receive a 20-point “Skills Bonus,” sharply lowering the barrier to reach the 40-point approval threshold. In practice, this directly accelerates global hiring by allowing employers to qualify candidates based on skills scarcity rather than seniority or salary inflation — particularly benefiting South Asian professionals in AI, data science, and cybersecurity whose profiles closely align with SOL requirements. 

The framework can be best understood through the table below:

4. Expansion of Non-Traditional Source (NTS) hiring widens the talent funnel

For operational and manual roles, Singapore relies on the Non-Traditional Source (NTS) framework, which allows employers to hire Work Permit holders from approved countries. From late 2025 into 2026, the government expanded the NTS Occupation List to allow broader hiring from India, Bangladesh, and Sri Lanka.

This expansion targets structurally constrained roles such as manufacturing operators and heavy vehicle drivers — positions with limited domestic supply. By widening access to these labour markets while enforcing a minimum salary floor of S$2,000, Singapore reduces operational bottlenecks without compromising labour standards. The NTS framework is as follows:

5. Wage pressure and rising total employment costs reinforce the shift

Talent scarcity directly feeds into cost pressure. The 2026 PERSOL Salary Guide projects overall wage growth of 3% to 5% across Singapore, with high-demand tech roles seeing sharper increases of 8% to 12%. At the same time, the Employment Pass qualifying salary rose to S$5,600 (S$6,200 for financial services) in 2025, raising the baseline cost of foreign professional hiring.

Combined with a 4.3% rise in median real income recorded in late 2025, these factors significantly increase total employment costs. For scaling companies, this environment limits flexibility and compresses margins.

As these dynamics converge, companies are moving beyond purely domestic hiring models and adopting a more deliberate global workforce strategy. By tapping into South Asian talent pools, firms can diversify their teams, manage cost risk, and still uphold the high technical standards required for global operations. 

This shift reflects a broader redefinition of what it means to scale globally. As Sagar Khatri, CEO of Multiplier, emphasized at Multiplier’s Beyond Border session, “Today, the definition of globalization is access to talent markets. You want to be global from day one, not only because you want to sell your products, but you want to access the talent they have in those countries.”

New South-Asian talent hubs are emerging

Building on this strategic diversification, Singapore organisations are increasingly forming distributed teams and tapping talent beyond their borders. According to Multiplier’s Talent Trends, India leads Singapore’s overseas hiring, accounting for 28.2% of international hires, followed by the Philippines (13.1%), Malaysia (11.1%), Indonesia (8.1%), and Vietnam (7.1%), with smaller shares in Bangladesh, Thailand, and Sri Lanka.

This mix reflects role-specific needs: India and Vietnam supply software, AI, data, and product development talent; the Philippines focuses on customer service, operations, finance, and marketing; while Malaysia and Indonesia provide regional commercial, operational, and mid-level technical roles, benefiting from time-zone proximity and cultural alignment with Singapore teams. 

These choices are driven by a combination of skills availability, collaboration ease, language fluency, and cost efficiency.

1. Skills availability and technical depth

India, Indonesia, and Malaysia offer large, skilled tech workforces in software, AI, cloud, and product delivery, making them attractive for Singapore firms seeking niche expertise. Emerging markets like Vietnam are also scaling up, providing mid-to-senior technical talent with growing local tech communities and expertise in full-stack development, cybersecurity, and mobile apps.

2. Time-zone alignment and collaboration ease

Close time-zone alignment across South and Southeast Asia enables real-time collaboration for product, engineering, and support teams. This proximity reduces coordination friction and ensures distributed teams can work seamlessly across borders.

3. Language and operational fluency

High English proficiency in India, the Philippines, and Malaysia allows professionals to integrate quickly into Singapore-led teams. Cultural and linguistic alignment supports smoother onboarding, lowers communication overheads, and accelerates team productivity.

4. Cost-effective, quality talent supply

These regions provide seasoned specialists at competitive wages, enabling Singapore firms to scale without inflating onshore costs. Companies gain access to high-quality technical and specialist talent at significantly lower total compensation than equivalent local hires, maintaining both skill standards and cost efficiency.

With these regional talent advantages in place, Singapore firms can now plan their next steps for strategic growth.

How Singaporean companies are expanding into South Asia with less risk

Key principles that every company must follow to succeed in global expansion include the following:-

1. Analyze talent market gaps and serviceability

When expanding into new regions, it is important to conduct a thorough check for market size estimation, intra-company leadership alignment and malleability in geography. It can be useful to focus on markets that are under-served or where specific skills are in high demand. 

These gaps often align with untapped talent pools that can support business growth.  “Trust your gut to identify populous markets where services are under-provided; these often reveal untapped talent pools that can drive growth,” advises Dennis Ng. By targeting these areas, companies can gain a first-mover advantage and secure high-potential hires before competitors saturate the market.

2. Decentralize hiring authority to local leaders

To scale hiring effectively, appoint local leaders or market heads who are physically present in the region. They will understand local nuances, cultural expectations, and talent availability far better than distant HQ teams. Dennis Ng emphasizes that “decentralized decision-making” allows these leaders to make faster, more contextually relevant hiring choices, accelerating team building and ensuring hires are aligned with local business realities.

He recounted in the webinar that when expanding in Africa, he deliberately appointed two CEOs in Africa, based in the DRC and Zimbabwe. This ensured that decision-making rested with leaders “closer to the ground” and “closer to the customers,” rather than with a headquarters located miles away.

3. Ensure operational and compliance readiness for candidates

A strong candidate experience requires that operational and compliance processes are ready from day one. This includes payroll, statutory benefits, insurance, and labor law adherence. “Without a framework for statutory payments and insurance, you risk losing the trust of new hires who need assurance their livelihoods are secure,” warns Liying Lim.

Failing to prepare for these legal hurdles can be disastrous. According to Multiplier’s Global hiring gap report, 46% of companies worldwide have actually failed to successfully onboard international talent specifically due to compliance issues.

Companies that integrate compliance into their hiring process demonstrate professionalism and reliability, which helps attract and retain top talent.

4. Adapt recruitment to local relationship dynamics

Hiring processes should respect local cultural norms and relationship-building practices. In many South Asian markets, decisions are made after extensive personal and family discussions rather than purely professional evaluation. “Securing top talent often requires hours of personal connection before professional matters are addressed,” notes Dennis. Patience and culturally sensitive engagement help build trust and improve long-term retention.

Methods for expansion out of Singapore

Global expansion for Singapore companies looking to hire internationally in South Asia can be done using the following solutions:-

1. Local entity setup

Setting up a local entity involves establishing a full subsidiary or branch in the target market. It is ideal for long-term, large-scale operations, giving complete control over company culture, HR policies, and equity plans. It is resource-intensive, slow to launch (6–12 months), and creates a taxable presence under local law.

2. Non-resident employer (NRE) payroll

NRE payroll allows companies to hire small remote teams without setting up a legal entity. A provider handles tax registration, payroll, and statutory filings, while you retain direct management control. However, your HQ remains the legal employer, meaning you bear PE risk, making this model unsuitable for revenue-generating roles.

3. Use an Employer of record (EOR) 

Multiplier’s Employer of Record services enable immediate hiring in markets with complex labor laws by acting as the legal employer. This minimizes PE and tax risks while shifting compliance and payroll responsibilities to the EOR. It is best for sales teams or short-term market tests, allowing your HQ to focus entirely on business strategy.

The difference between these three solutions can be understood through the table below:

By combining the right market entry strategy with thoughtful local hiring practices, Singaporean companies can expand into South Asia efficiently, minimizing risk while laying the foundation for sustainable growth.

How to scale sustainably 

Sustainable scaling is the process of growing a business in a way that maintains operational efficiency, preserves company culture, and empowers employees to perform at their best, even as headcount and market complexity increase.

For Singaporean companies expanding into new talent markets, this begins with establishing the right core systems early. Remote employees should have access to tools and infrastructure that let them focus on their work rather than manual administrative tasks. This includes integrated global payroll and HR systems that ensure accurate pay, tax compliance, and statutory reporting across markets and currencies, alongside seamless connections to HRIS and ERP platforms.

Equally important is embedding culture through global leadership. Leaders must model company values from day one, maintain flat hierarchies, and foster accountability and empowerment. As Liying Lim notes, “As you go from 10 to 1000, 1000 to 5000, if we don’t ensure the embodiment of values, it’s hard for new hires to truly live and understand the business.”

Together, strong operational foundations and values-led leadership create psychological safety at work — an environment where employees can voice ideas and concerns freely and contribute fully. This ensures that culture and performance scale alongside the organization, rather than being diluted as the company grows.  

Unlocking the neighbourly advantage

The shift toward South Asian talent is no longer a tactical “cost-saving” move; it has become a strategic necessity for Singapore’s continued position as a global business hub. As domestic labor constraints and demographic shifts tighten the local market, the ability to tap into the technical depth of India, the operational fluency of the Philippines, and the emerging tech prowess of Vietnam is what will separate high-growth firms from those that stagnate.

Success in this new landscape requires more than just remote job postings — it demands a sophisticated approach to global integration. As highlighted by industry leaders, the winners will be those who prioritize decentralized leadership and cultural empathy, ensuring that “reliability” and “trust” are baked into the recruitment process. 

Whether through the agility of an Employer of Record (EOR) or the long-term commitment of a local entity, the goal remains the same: building a seamless, compliant, and high-performing workforce that operates across borders as a single unit.

By embedding psychological safety and robust digital infrastructure into their DNA, Singaporean firms are not just hiring talent; they are building a sustainable, borderless ecosystem ready for decades to come.

Book a demo and scale compliantly with Multiplier!

Source

1. Press Release – Ministry of Trade and Industry, Singapore
2. Labour Market Report – Ministry of Manpower

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