Retrenchments in tourism industry are ‘inevitable’ without resumption of mass market travel: Chan Chun Sing

SINGAPORE: Job losses in the Singapore tourism sector are “inevitable” without mass market travel, but the Government will work with businesses and workers to help them adapt to the new COVID-19 reality, Minister for Trade and Industry Chan Chun Sing said on Wednesday (Jul 22) in a virtual dialogue with more than 600 tourism industry players.

“Without the resumption of mass market travel, we have to be realistic that the headwinds mean the challenges in the coming months will be severe, and it will be inevitable that some segment of our industry will have to retrench, to let go of the workers in the short term as we rebuild the new offerings,” Mr Chan said. 

The Government will work with companies that need to refashion their products or services, but if that is not enough, then it will help workers find new jobs, he said.

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The UN World Tourism Organisation in May estimated that the number of international tourists will decline by up to 78 per cent in 2020 as compared to 2019, said Mr Chan. The global confidence in safe travel, especially air travel, has dropped significantly, he added.

Singapore Tourism Board’s (STB) brand health survey in April showed that only 24 per cent of travellers across 14 key markets felt confident to travel internationally, and only 33 per cent of them felt confident to visit Singapore.

The tourism sector in Singapore has come to a standstill as visitor numbers to the island have plummeted.

In May, there were 880 visitor arrivals, a year-on-year decline of 99.9 per cent. Resorts World Sentosa, one of the largest tourism employers here, let workers go last week as part of cost-cutting measures in the wake of the pandemic.

Some workers in the tourism and aviation sectors have already switched roles, with some becoming safe distancing ambassadors and others entering the healthcare sector or the education industry.

Mr Chan said that despite Singapore’s “small market”, there are sufficient jobs for Singaporeans. 

“The question is, how do we quickly reskill them for those jobs that are still available … we are committed to make sure that we spend the next few months and years to put in the resources to help Singaporean workers reskill themselves and take on these other jobs while we await the recovery of the tourism sector,” he said.

Commentary: More bold measures needed to protect against the job losses heading Singapore’s way

READ: Singapore in technical recession after GDP shrinks 41.2% in Q2 from preceding quarter due to COVID-19

Mr Chan warned that restrictions on air travel and social interactions due to the COVID-19 pandemic will persist for some time, as he called on businesses in the industry to reinvent themselves.

“My own personal sense is that really without a vaccine, really without a rapid test, it is very difficult for us to imagine the resumption of air travel as what we were used to in the past,” he said. “We will have to learn to live in a COVID world for the foreseeable future.”

Citing the MICE (meetings, incentives, conferences and exhibitions) industry as an example, he said that businesses will have to “scale digitally” to bring people together while abiding by safe distancing measures. 

STB had announced earlier on Wednesday that it will be working with MICE businesses to trial “hybrid events” with a mix of face-to-face and virtual interactions.

He said: “Our opportunity is this, if we can do this well in Singapore – then we will show the way for the rest of the industry in other parts of the world to come together to work with us as well.”

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The minister highlighted that the Government’s “immediate priority” was to save as many jobs and businesses as possible, but said that support measures, which are costing close to S$100 billion, are not sustainable in the long term.

These measures have helped more than 7,000 tourism businesses to save jobs and have provided wage support for more than 1,600 self-employed tour guides. While some have fallen through the cracks, the Government is committed to reaching out to as many people who need help as possible, he said.

But he urged businesses to redesign their tourism products as their existing business model may not be available, or their existing markets may not return, for the next one to two years. 

For example, some businesses that focused on visitors from only one country had their revenues “wiped out” when certain countries stopped outbound travel, he said, and they could come up with new propositions to cater to higher-end markets and markets that might resume travel earlier.

“I foresee that the market will progressively resume with the higher quality travellers first. It will be a quality game and not a quantity game. It will be a niche market game and not a mass market game,” he said.

He added: “We will have to spend much more effort, much more resources to help our industry refashion the products, re-imagine the future, to complement what we have done in the previous few months, which was to basically stem the tide of job losses and business closures when the COVID first hit us.”

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