The government’s Graduate Industry Traineeships, known as GRIT, offer a stopgap for graduates to gain industry-relevant experience with government agencies or private businesses, with an allowance of 1,800 to 2,400 Singapore dollars ($1,400 to $1,850) per month. The lowest end of that range is less than half the median graduate’s starting salary and around two-thirds the wage of a McDonald’s Corp. management trainee, who needs only a pre-university diploma.

“When I started the program, I thought: ‘Shucks. I’ve finished four years of school and all I’ve got is a job that pays half of what my friends get’,” said Lee Jia En, a 25-year-old graduate from the Singapore University of Social Sciences. “But I felt it was worth it if it could help me get to my next job. So I said OK, let’s eat humble pie.” 

Governments around the world have been laboring to prop up a sagging graduate jobs market amid a surge in artificial-intelligence adoption, a post-pandemic slowdown in hiring and lingering economic impacts from the Iran war. 

Those headwinds run especially strong in trade-dependent, energy-importing Singapore. “Heightened uncertainty” has made businesses in the city-state more cautious about hiring, Manpower Minister Tan See Leng said in May, while Prime Minister Lawrence Wong has warned that some existing jobs “will disappear” because of AI. In the first quarter, retrenchments across the workforce climbed to the highest level in nearly three years. Still, the broader labor market showed resilience with the unemployment rate holding steady at 2%.

Phang Jun, a 24-year-old communications major who graduated last year from Singapore Management University, felt her college degree was “useless” after applying for 100 jobs and receiving three low-paid offers outside her sector.

She’s not the only one in that bind. Full-time employment rates among business, arts and science graduates from all six of Singapore’s universities fell about 10 percentage points between 2023 and 2025, the country’s latest annual graduate employment survey published in March shows. 

Against that backdrop, the Ministry of Manpower launched the traineeships, echoing a similar program rolled out during the Covid-19 pandemic. Around 70% of each trainee’s fixed compensation range is funded by the Singaporean government, while employers foot the rest. 

That has provided a key incentive to businesses to take on trainees in an otherwise challenging hiring environment, said participating companies surveyed by Bloomberg News. Oversea-Chinese Banking Corp Ltd has hired 40 trainees in areas including data and credit analysis after offering 50 places on the scheme, said Lee Hwee Boon, head of the bank’s human resources. 

But job-seekers haven’t seized on the plan as expected. Applications fell about 90% between the program’s launch in October and February, with over half of 800 roles filled by March, Tan has said. The minister credited the softening uptake to applicants declining placements in favor of other job opportunities. 

In response to queries, MOM directed Bloomberg News to the same parliamentary speech by Tan.

Academics and graduates offer an alternative explanation: that job-seekers could be discouraged by a stigma they associate with the program and its compensation level, “particularly if they believe that GRIT is intended mainly for graduates who are unable to secure employment,” said Kelvin Seah, an associate professor of economics at the National University of Singapore.

Graduates weighing up their long-term prospects may also be put off by the modest allowance, in a market where employers often base salary offers on an applicant’s most recent pay packet.

Lee, who earned a second-class honors degree and four internships, said she felt “ashamed” of signing up for a scheme that her friends shunned because of the low compensation. And on the job, her boss relegated her to menial tasks like printing and laminating documents, “to be fair to the amount” she was being paid.

“I thought I’d worked hard enough, but it’s just so competitive,” she said. In the end, she landed a permanent position with “real responsibilities” under the same government employer.

The government has said it deliberately caps trainee allowances at half that of the median graduate’s first salary, “to ensure trainees continue to prioritize” permanent employment and encourage employers to hire trainees on proper contracts. 

Still, being in employment limbo for months can wear down graduates. Ng Hui, a 26-year-old information systems graduate from Singapore Management University, said his S$2,400 stipend is “not enough” to chip away at his S$50,000 of university loans. After work as a data engineer trainee at a government agency, he boosts his bank balance by tutoring secondary school students, and saves money by spending much of his free time alone at home. His weekends are “burned” studying for interviews.

After months of hustling, it “frustrates” him that there’s no guarantee he’ll be hired permanently.

Without a clear payoff from her traineeship with a tech company, graduate Phang is focusing instead on networking with her colleagues to set herself up for her next job. She’s now become more open to a wider variety of roles as she’ll have to compete with thousands more graduating next month. 

“Right now,” she said, “I’ll just take whatever comes.”