Singapore doesn't set a local-hire quota — it caps the share of foreign workers a company can employ, via the Dependency Ratio Ceiling (DRC). For a buyer, this matters because the headcount you're paying for may not be sustainable under your ownership.
How the ceiling works
The DRC is the maximum proportion of your workforce that can be Work Permit / S Pass holders. It varies by sector:
- Services: 35% foreign share
- Manufacturing: 60%
- Construction / Process: 87.5%
There's also a tighter S Pass sub-ceiling (10% in Services) and a Local Qualifying Salary that determines whether a local employee counts toward your quota.
The buyer's trap
Say you're buying a services business with 10 staff, 8 of them foreign. The Services ceiling is 35% — meaning the foreign headcount is only sustainable if you have roughly 15 qualifying locals. You don't. So the workforce you just paid for can't legally be maintained, and you'll face costly local hiring or lost capacity.
What to verify before signing
- The current local/foreign split and each pass type.
- Whether locals are paid above the Local Qualifying Salary.
- Upcoming changes (the LQS and pass salary floors rise on fixed dates).
Treat any deal that breaches the ceiling as carrying a real, quantifiable cost — not a footnote.