AI Will Drive Singapore’s Economic Growth But May Not Fuel Job Creation as Before, Says Tan See Leng

The Government recognises that artificial intelligence and automation may allow firms to produce more with fewer workers, Tan said at the MTI Economic Dialogue on 26 August.

“As such, we can no longer assume that growth will automatically create the same number, the same type, or the same range of jobs as before,” he said. “What we will do is make sure that all of our AI adoption, always the core, is human-centric.”

This means building pathways into growth sectors, raising the quality of jobs in essential and resilient occupations including skilled trades, and encouraging entrepreneurship. Tan also pointed to plans to offer “career bridges” to workers who are more exposed to disruption from AI, automation and changing cost structures, to support them in the move to other opportunities.

Tan added that it was important to ensure that gains from AI diffuse beyond leading firms. Small and medium-sized enterprises must also be able to adopt useful solutions, with workers equipped to use AI alongside their current expertise.

“In short, we want Singapore to be valuable not just because goods, people, capital and energy pass through us, but also because important decisions are made here,” Tan said. “These activities create, in turn, a virtuous cycle where opportunities and capabilities continue to abound for Singaporeans as well as our companies,” he added.

The event was attended by around 190 participants, most of them students from universities and junior colleges. Tan also presented the Ministry of Trade and Industry’s economist service undergraduate scholarships to six recipients.

Tan said he recognises AI can be daunting for some who might be nudged to upskill. He quipped: “I am 61. When I go for my old class gathering and I tell them about AI, they say, please, don’t act smart. My own contemporaries look at me in bewilderment. They say, do you know what you are doing? But this is the trade-off. As a government, we know that this is bitter medicine, but it’s good for you.”

A student asked how a cost-benefit analysis would be done for the western island Singapore intends to create in the coming decades, as announced by Prime Minister Lawrence Wong at the recent National Day Rally, and whether a nuclear power plant would be sited on it. PM Wong had said that Pulau Semakau, Pulau Bukom and Pulau Sudong were among the islands that could be merged through planned land reclamation. The student pointed to media reports mentioning that some coral reefs in the area were more than 8,000 years old.

Tan said “very detailed” environmental studies will be done before the area is developed. “Our heritage, our reefs, our environment are not something that we will compromise,” he said, while adding that Singapore needs space for its airports and maritime ports to continue to grow.

On nuclear power, “we have not decided in any way,” Tan said. He pointed to alternatives, saying: “I have gone full hog, full swing into exploring geothermal. I’m a perpetual optimist. If I’ve cracked the code on geothermal, I may not even need to build that many of these extra facilities on reclaimed islands.” He added: “There are many, many uncertain development timelines, new technology that, today, we are still exploring.”