THE subsidies from the Wage Credit Scheme will fund training programmes for the Singaporean staff at manufacturing and distribution firm Foh Foh Co to improve their productivity.
"For us to increase their pay, they first have to be more productive," said business development manager Andrew Chong, adding that the firm will "focus on training locals and supporting our local staff".
The training will focus on helping staff achieve higher sales and production volumes, he said.
The company distributes household goods such as plastic storage containers and kitchenware, from brands such as Lock & Lock and Mitsubishi. It also manufactures a brand of plastic storage containers in-house.
The firm typically gives out wage increments of 5 per cent to 10 per cent each year to its 50 employees, 20 of whom are Singaporeans.
The company last year invested $300,000 in a project that resulted in more seamless information sharing across its departments, including warehousing, sales and finance.
Sales staff were also issued with PDAs that could be updated with real-time information about stock availability.
The project received a 40 per cent subsidy in the form of a grant from NTUC's e2i Inclusive Growth Programme.
In the past, the company's yearly stocktaking took up two weeks. Since the new system was implemented last year, this has been cut to two days. Losses from inaccurate stock records have also been halved.
The firm passed on its gains to its workers in the form of wage increases of about 13 per cent.
While the Wage Credit Scheme's objective is to help firms take advantage of productivity-enhancing opportunities like this, it also has its downsides, said Mr Chong.
"It's a very high commitment on our part to increase salaries, and the scheme will only give us short-term support," he said.