Outsourcing services: Your solution to Singapore's talent shortage

Singapore is witnessing an unprecedented shortage of talent across many sectors, including professional services.  The number of job vacancies in 2022 reached its highestⁱ level in over a decade, peaking at 115,000, and this development comes as the country tightens its foreign labour policies through measures such as raising the qualifying salary of foreign professionals. 

Labour and talent shortage due to staff attrition and foreign worker restrictions were ranked as the top two business concerns for close to a third of employers, revealed a survey conducted by the Institute of Singapore Chartered Accountants (ISCA).

The recent climate of economic uncertainty and the shift towards new working models have introduced complex financial reporting risks and compliance requirements. As new accounting standards come into force, the demand for accounting experts will continue to soar. However, finding top accounting talent remains a challenge for businesses.

Operating costs are rising amid surging global inflation, despite seeing the first signs of economic recovery from the impact of the pandemic. As price pressures intensify, employers are struggling to attract and retain skilled talent whilst keeping costs under control.

This is where outsourcing comes into play. Services such as the outsourcing of accounting services, corporate secretarial support and payroll management provide businesses with dedicated support and expertise from ‘the back office’, enabling companies to continue to focus on what they do best — running their business, developing new products and services or expanding into new market segments.

Specifically, outsourcing critical functions like payroll and compliance services has become a key strategy for smart businesses in Singapore to mitigate risk and drive efficiency.

Benefits of outsourcing

Outsourcing is the process of transferring a business process or activity to an external entity or organisation. Why has outsourcing become a more prevalent choice for businesses around the world?

Streamline operations with outsourced services

●      Improved operational efficiency

As businesses grow in size, the increasing requirement for accounting, corporate secretarial, payroll and HR, and other business support functions can be difficult to keep on top of. 

Outsourcing these activities can reduce the pressure on internal resources, allowing the leadership to focus on strategic functions and the core mission of the business.

Turning to an external provider for routine tasks can bring significant value for the business because greater productivity can be achieved on high-value duties that drive profitability.

●      Better flexibility, scalability and cost control

Having a dedicated internal department for accounting, corporate secretarial or payroll can be time-consuming and expensive. This is especially true for payroll services in Singapore, where the cost of specialised software and dedicated staff can be prohibitive for a growing company. Further, some businesses do not require this expertise all year round, but rather for short-term projects.

For a more efficient alternative, businesses can instead lean on their outsourcing partner for additional support in business-critical positions as and when they are required. They can draw on the expertise of the right professionals to better meet changing market demands.

Furthermore, the cost of recruiting, onboarding and training is significantly reduced, and some department-specific infrastructure is no longer required. Outsourcing also alleviates the cost of employee benefits, for example, payroll taxes and insurance. Companies get the full advantage of a ready-made team with the expertise they need by finding the right outsourcing solution, tailored to their budget.

Business goals can shift and fluctuate quickly. Outsourcing services are flexible and scalable, enabling you to react quickly to changes in your business or market by scaling up or down as required.

Ensure a peace of mind with our compliance expert

●      Higher expertise enhances quality

Increasingly, we see a trend of companies outsourcing their high-level financial and accounting functions. This provides them with direct access to qualified experts who will offer a fresh perspective on the company’s financials. Businesses can see improved financial reporting and controls in addition to increased transparency.

Compliance requirements are growing more complex every day. As companies try to keep up with the changes, it can put a strain on their resources. However, specialised service providers devote their time to staying abreast of ever-changing economic and legislative developments. By focusing on their area of expertise, they can help clients meet and exceed their compliance needs with peace of mind.

The differing regulations in each jurisdiction make it a challenge to manage HR and payroll functions internationally. With rules and policies changing so frequently, processing payroll in-house can be inefficient for some businesses. Outsourcing can improve accuracy, efficiency and security.

With the right service provider, businesses also gain access to the latest tools and cutting-edge technology. Valuable analytics provided by an outsourcing partner can enable business leaders to make informed decisions for future performance.

●      Risk management

Managing risk is becoming ever more challenging, driven by changing legislation and the long-term consequences of the COVID-19 pandemic. For companies that do not have the right internal skills and resources in place, outsourcing can assist with risk management.

Some companies find it essential to outsource in order to close critical skills gaps. A lack of expertise in key areas can make businesses vulnerable to operational disruption or even criminal acts. The inability to meet compliance obligations may also expose a business to reputational and financial damage. 

Experienced providers have robust processes and a proven track record for risk mitigation. Their expertise enables companies to reduce their exposure to costly business interruptions that could impact the bottom line.

When it comes to risk mitigation, it’s always valuable to have a fresh pair of eyes to ensure better control procedures. Corporate secretarial outsourcing can help reduce risks and protect against the costs and consequences of compliance lapses, including fines, legal action or director disqualifications. 

Focus on your growth with Forvis Mazars's outsourcing services

Concentrating on core operations can help businesses thrive and have a positive impact on business performance.

At Forvis Mazars, our outsourcing experts will help you run a leaner and more efficient business. This enables you to focus your resources on what you do best.

Contact our outsourcing services today to learn more. 

[i]Ministry of Manpower