Impact Of The Jobs Support Scheme (JSS) On Labour Market Outcomes

To safeguard the livelihoods of local workers amidst the economic disruptions caused by COVID-19, the Government implemented the Jobs Support Scheme (JSS). Under the scheme, wage subsidies were provided to employers to support the retention of local employees. This study evaluates the effectiveness of the JSS in preserving local jobs and wages in 2020.

Our findings suggest that the JSS was effective in helping locals to retain their jobs in sectors that were more severely affected by the pandemic. Specifically, for firms in JSS Tiers 1 and 2, we estimate that for every 10 percentage-point (pp) increase in the effective JSS wage subsidy, there was a net increase of 0.44 and 0.13 local jobs saved per firm per month respectively. These estimates translate to a total of 165,000 local jobs preserved over the period of March to December 2020.

In addition, we find that the JSS helped to preserve local workers’ wages. For every 10pp increase in the effective JSS wage subsidy, local wages were about 1.7 to 5.3 per cent higher on average, depending on the JSS tier. This translates to higher average monthly wages of about $70 to $150 for local workers.

The views expressed in this paper are solely those of the authors and do not necessarily reflect those of the Ministry of Finance (MOF), Ministry of Manpower (MOM) or the Government of Singapore.

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