February 2026 HR News Roundup: Budget Updates, AI Restructuring & Workforce Trends

Budget 2026: EP Salary Threshold Rises to S$6,000 in 2027

As part of Budget 2026, Singapore is updating its foreign work pass framework to ensure the workforce remains competitive while maintaining a strong local core.

Starting January 2027, the minimum monthly salary threshold for new Employment Pass (EP) applicants will rise to $6,000 ($6,600 for Financial Services), with further age-based increases for candidates up to age 45.

S Pass thresholds will also increase to $3,600 ($4,000 for Financial Services), while adjustments to work permit levies will take effect from 2028.

These upcoming changes necessitate a review of recruitment budgets and renewal pipelines, as existing pass holders will need to meet these new criteria starting in 2028.

New Malaysian Insurance Scheme to Cover Citizens Working in Singapore

Malaysia is introducing a new social security insurance scheme specifically designed to protect the estimated 1.18 million Malaysians working in Singapore, with a focus on the 400,000 daily commuters.

This initiative addresses current coverage gaps by ensuring these workers are protected during their cross-border travel and outside of standard working hours.

Aligned with International Labour Organization (ILO) standards and following recent amendments to the Employment Insurance System (SIP) Act, the scheme aims to provide affordable, comprehensive protection for the Malaysian workforce in Singapore through minimal employer contributions.

Rise of 'Job Huggers': 60% of Employees Stay Out of Fear, Not Loyalty

The rise of "job hugging" in early 2026 suggests that while 60% of employees are staying in their current roles, this retention is driven by market anxiety rather than genuine loyalty.

Driven by fears of AI displacement, layoffs, and "last-in, first-out" policies at new firms, many workers are choosing stability over career movement.

Failing to address their underlying insecurities could lead to a workforce that is physically present but professionally disengaged. The solution lies in identifying and re-engaging these "stagnant" employees with trust, recognition, and meaningful growth opportunities.

Singapore Allocates $235M to Bridge the Green Skills Gap

Singapore aims to transition to become a low-carbon economy, driven by the Green Skills Committee’s new strategic framework.

This initiative signals a major shift toward integrating both horizontal green skills (applicable across all industries) and sector-specific vertical skills, particularly within finance, aviation, and the built environment.

The government is bridging talent gaps through IBF-accredited courses, Career Conversion Programmes, and specialized certifications.

Singapore Pledges to Ease Community Care Wage Hikes

To support Singapore’s aging population and maintain sector competitiveness, the Ministry of Health has pledged S$100 million to help Community Care Organisations (CCOs) manage upcoming wage hikes.

This funding serves as a strategic buffer for CCOs as the government updates salary guidelines to increase total annual remuneration by 7% or more, benefiting approximately 23,000 employees.

For HR leaders in the care sector, this initiative aligns community care compensation with broader healthcare benchmarks, such as those for nurses and allied health staff, aiming to bolster recruitment and retention. Detailed guidelines are expected within the coming months, with implementation slated for late 2026 or early 2027.

Are Your Hiring Practices Chasing Candidates Away?

A new report reveals that 62% of HR leaders are facing a "self-inflicted" talent crisis caused by outdated, lengthy hiring processes and "unnecessary elitism" in job descriptions.

To bridge the gap between available qualified candidates and open roles, HR must simplify the candidate journey by reducing application steps and setting more realistic skill expectations.

Leveraging automated hiring tools such as Applicant Tracking System (ATS) for redundant tasks can free up time to focus on professional development and clearer benefits communication - two critical factors, as nearly half of employees cite poor development or vague benefits as reasons for leaving.

Ultimately, shifting from rigid, complex hiring to an agile, candidate-centric approach is the key to solving the 2026 talent shortage.

Singapore Looks to Enhance Worker Support as AI Adoption Surges

As AI-driven restructuring reshapes Singapore’s labour market, the Economic Strategy Review committee is proposing a proactive shift toward "career health" and early intervention.

For HR, this means a likely transition toward mandatory advance retrenchment notifications and expanded career conversion programs designed to upskill employees before displacement occurs.

By doubling down on Workforce Singapore initiatives and tripartite partnerships, the government aims to ensure that even as job creation patterns shift, the workforce remains resilient, adaptable, and supported through guided transitions.