Can Low Wage Workers Earn Higher Wages In Singapore?

The short answer is, yes. But how?

In this article, we will look at the workers’ wages vs the foreign worker levies.

In the chart below, you can see the wages of selected low-wage jobs in Singapore, based on the latest available data – low-wage earners earn below $1,500 in Singapore. Cleaners and construction workers earn about $800 to $850.


Chart 1: Ministry of Manpower Report on Wages in Singapore 2011

If companies would like to hire foreigners for these job positions, they would need to pay an additional foreign worker levy for each worker.

If we add on the top-tier levy for each of these job positions, Chart 2 shows you how much an employer would have to pay for each foreign worker in 2013.


Chart 2: Ministry of Manpower Report on Wages in Singapore 2011Overview of Foreign Worker Levy Changes Till Jul 2015


You can see that for a cleaner, the employer would have to pay a total of $1,415 for the worker and not the actual wage of $800. This means that of the total cost of the foreign worker, 42% of the cost actually goes to the government. Similarly, for a construction worker, the employer would actually pay 47% of the cost of the foreign worker to the government.

The other way to look at it is this – for a cleaner, the employer has to pay 74% of the wages to the government for the foreign worker levy. For the construction worker, the employer has to pay 88% of the wages to the government for the foreign worker levy.

So, the government might say that “employers are required to pay Foreign Worker Levy for their Work Permit holders”, as a “pricing mechanism to regulate the number of foreign manpower in Singapore”.

But the question is – is this a sound policy?

According to the Ministry of Manpower, the wages of low-wage Singaporean workers have remained stagnant over the past few years (Chart 3).


Chart 3: Ministry of Manpower Report on Wages in Singapore 2007Ministry of Manpower Report on Wages in Singapore 2008Ministry of Manpower Report on Wages in Singapore 2009Ministry of Manpower Report on Wages in Singapore 2010Ministry of Manpower Report on Wages in Singapore 2011

Thus you can see that over the past few years, because it is cheaper to hire foreign workers, companies would hire foreign workers at low wages and wages have thus been kept at a depressed low level. As such, Singaporeans have to also accept low wages in order to have a job.

And if you look at the proportion of Singaporeans who earn below $1,500, there are 26% who are in low-wage jobs (Chart 4), which is a significant amount. Are the wages of these Singaporeans depressed because of the low-wage situation?


Chart 4: CPF Annual Report 2011

What does the foreign worker levy have to do with the low wages of Singaporeans, you say?

You see – the foreign worker levy has been increasing over the past few years.

In fact, in 2015, the foreign worker levy would have increased to $1,050 for a construction worker.

Thus in Chart 5, you can see that in 2015, for a cleaner, the cost of a cleaner is actually $1,615 and not the $800 that would be paid to the worker. Of the cost, 50% would actually go to the government. For a construction worker, 55% of the cost would actually go to the government!

This means that the employer has to pay 98% of the wage of a cleaner and 124% of the wage of a construction worker to the government as the foreign worker levy. Why is it that the workers are doing the job but the government takes in the chunk of the workers’ wages for doing nothing?


Chart 5: Ministry of Manpower Report on Wages in Singapore 2011Overview of Foreign Worker Levy Changes Till Jul 2015

So, why is this worrying? For each worker, instead of the worker benefitting from higher wages over the years for the work that he/she is actually doing, it is the government which is actually benefitting from increasing revenue from the levies by doing nothing and waiting for the money to come in.

Maybe the charts below will make things clearer for you.

If you look at the foreign levy for a cleaner, the levy has increased from $450 to $800 – or 78% (Chart 6).


Chart 6: Schedule of Foreign Worker Levy Changes Until July 2013Overview of Foreign Worker Levy Changes Till Jul 2015

But when you look at the wages of a cleaner, wages have remained stagnant – or with an overall increase of 7% (Chart 7).


Chart 7: Ministry of Manpower Report on Wages in Singapore 2007Ministry of Manpower Report on Wages in Singapore 2008Ministry of Manpower Report on Wages in Singapore 2009Ministry of Manpower Report on Wages in Singapore 2010Ministry of Manpower Report on Wages in Singapore 2011

And if you look at the foreign worker levy for a construction worker, it has increased from $310 to $1,050, or 239% (Chart 8).


Chart 8: Schedule of Foreign Worker Levy Changes Until July 2013Overview of Foreign Worker Levy Changes Till Jul 2015

But for the wages of a construction worker, it has also remained stagnant – or with an overall increase of 6% (Chart 9).


Chart 9: Ministry of Manpower Report on Wages in Singapore 2007Ministry of Manpower Report on Wages in Singapore 2008Ministry of Manpower Report on Wages in Singapore 2009Ministry of Manpower Report on Wages in Singapore 2010Ministry of Manpower Report on Wages in Singapore 2011

Do you see the discrepancy? The foreign worker levy for a cleaner went up by 78% but the wages of a cleaner only went up by 7%. For a construction worker, the foreign worker levy went up for 239% but wages only went up by 6%.

And do you know how much the government is collecting from the levies? According to the Ministry of Manpower, “the total foreign worker levies collected were S$2.5 billion for the Financial Year 2011 and S$1.9 billion for the Financial Year 2010“. So, the government is seeing higher and higher revenues from higher and higher foreign worker levies, while the workers see declining real wages.

So, the government might say that the foreign worker levies is “a pricing mechanism to regulate the number of foreign manpower in Singapore”. But, has the foreign worker levies really helped to “regulate the number of foreign workers in Singapore”?

Not really.

In fact, the number of workers on S Pass has kept increasing (Chart 10).


Chart 10: Ministry of Manpower Foreign Workforce Numbers

The number of construction workers on work permits has also kept increasing (Chart 11).


Chart 11: Ministry of Manpower Foreign Workforce Numbers

Not only that, the Singapore Population White Paper projects that the increase in the number of foreign workers will also go unabated (Chart 12).


Chart 12: Ministry of Manpower Foreign Workforce Numbers, Population White Paper

As such, it is clear that the foreign worker levies do not actually “regulate the number of foreign workers in Singapore”. What is clear is that the foreign worker levies do bring in more and more revenue for the government – from $1.9 billion in 2010 to $2.5 billion in 2011 – and to more than $3 billion now?

What is also clear is that while the government is collecting more revenue from employers, the wages that employers pay to workers have remained stagnant – at around $800 for cleaners and $850 for construction workers.

The question you have to ask is this – why has the government been so resistant towards implementing a minimum wage but has not at all been hesitant to increase the foreign worker levies on companies? If the explanation given to not implementing a minimum wage is that this will add to the cost of companies, then why has the government increased levies by up to 240%? Doesn’t this still add to the cost of the companies anyway?

Now, imagine this – instead of the government asking companies to pay foreign worker levies, these foreign worker levies are given to the workers as wages.

Immediately, you will see that in 2015, instead of workers earning $815, they will earn $1,615. For construction workers, instead of $850, they will earn $1,900. For waiters, instead of $1,300, their wage will cross the $2,000 mark (Chart 13).


Chart 13: Ministry of Manpower Report on Wages in Singapore 2011Overview of Foreign Worker Levy Changes Till Jul 2015

For the lowest wage workers, they will immediately see a doubling of their wages!

How will this benefit Singaporeans? When foreign workers are paid higher wages, Singaporeans will not be forced to accept lower wages as well. Singaporeans will be able to receive higher wages. So a Singaporean who works as a cleaner will be able to earn $1,615, a waiter will be able to earn $1,300 and a bus driver would be able to receive a basic salary of $2,300 – all the low wages workers would be able to receive a wage of above $1,500! And this is done without any additional cost – we are simply transferring what is paid to the government back to the worker, who should be rightfully receiving his/her wage. Will we be able to reduce the proportion of Singaporeans earning below $1,500 from the 26% now to less than 10%, or even less than 5%? It is quite likely.

This is definitely better than the “progressive wage model” propounded by Minister without portfolio Lim Swee Say. While as a cleaner under the progressive wage model, you would need to be promoted before you can earn a paltry increase of $100, but if the foreign worker levies are returned to workers as wages, they would immediately see an increase of $800, without the excuse of a promotion.

So, when the government “explains” that they cannot implement a minimum wage because it will suddenly increase costs, is this a logical reasoning or is it really an “excuse”? Certainly, if the government has no qualms increasing the foreign levies by up to 240%, cost isn’t a factor that they are concerned for the companies, is it? If the foreign worker levies have no intended effect of reducing foreign worker numbers, but has the very clear effect of increasing government revenue, then quite clearly, increasing government revenue seems to be the more overt intent of the foreign worker levies than to curb foreign worker numbers – which the government clearly has no want to do so anyway, as illustrated by the population white paper.

By artificially imposing the foreign worker levies as a “pricing mechanism”, hasn’t the PAP government intervened in the free market dynamics and upset demand-supply economics? If the government has allowed for demand and supply to determine wages, instead of artificially imposing a “pricing mechanism” in the form of foreign worker levies, would demand-supply have been better able to determine the equilibrium wage to be paid in each job sector, and push wages upwards to benefit workers?

In imposing the foreign worker levies and artificially depressing the wages of workers, while increasing the levies and the revenues collected by the government, has the government acted to “rob” the wages that should have rightfully gone to the workers? Is such direct government intervention a key reason why the wages of Singaporeans have remained stagnant, and why the real wages have in fact declined?

It would seem quite clear at this point that if the government doesn’t seem to be too concerned about the cost constraints of companies, that implementing a minimum wage isn’t something too difficult for them to do. The question then isn’t about whether there are practical difficulties to do so, but whether the PAP government has the political will to do so and to help Singaporeans, or whether the government is more keen to restructure the policies to increase revenue to their own coffers.

I think the fact that the PAP government has allowed wages to remain stagnant while increasing foreign worker levies (and government revenue) even to amounts over and above what would be paid to the worker is a very clear indicator as to where their priority lies. Perhaps the PAP government has forgotten this – they can continue to treat workers as singular digits to be used and discarded, but don’t forget who is doing the work for you. Don’t forget who is helping you build and clean the buildings and train lines you earn the money from. Without the workers, you will have no money to earn. It would bode well for the PAP to learn to respect those who have helped them, and not cast them aside once they are no longer of use to the PAP.


Empowering Singaporeans had just organised our first workshop – Towards a Better Education System – last week. We will be holding the next workshop to discuss about the jobs, wages and employment situation in early 2014. 

Follow us on the Empowering Singaporeans Facebook page or email us at for more updates.

Towards Better Jobs, Wages & Employment in Singapore Teaser Poster


  1. eric

    Hi Roy.
    Do you.consider being the Prime Minister of any country? Or even head a.huge organisation? As you look so.well versed in all areas! A true talent!
    Oh yes, cleaners still earn 800? Part time or full time? Isn’t the intention of drastically raising levies is to make employers employ singaporeans first? No? And what is wrong for the govt to collect these levies as tax? If not than where money.come from? Shd pap follow your nordic example of taxing everyone or pay gst 20%?
    if employers fee. The pinch, naturally they will employ locals, thus increase their salary as more.demand, less supply.
    If don’t use money to collect levie than use what? Hot air? Shd companies pay for foreign workers with hot air or macdonalds? Tak chey till tau nau Pai.

  2. more thinking please

    Roy, you’re very wrong. Increasing the levy on foreigners has the effect of increasing the wages of locals.

    Say, a foreigner costs $500 wage and $500 levy. The employer can offer a Singaporean $900 wage, which is in line with the total $1000 (wage+levy). That’s of course, provided he can find some Singaporean, if any.

    Now, when the levy increases to $1000, he can offer $1400 to a Singaporean, in line with $500wage+$1000levy. Now, he has better chance of finding a Singaporean who wants to accept.

    Quota and levy are both policies to help Singaporeans. If you remove the levy, you’re actually destroying the rice bowls of low wage Singaporeans.

    If you return the levy to the foreign workers, you’re also destroying Singaporeans. The money used to build Singapore for Singaporeans will now out-flowed to foreign countries.

    In which way does your suggestion help Singaporeans? The loss in levy will outweigh the increase in home wage. Increasingly, Singaporeans are not interested in these jobs anymore, so in the first place, less Singaporeans will be in these jobs in the first place so the local wage increase is limited. You’ll just be siphoning money to foreign countries and less revenue will be available for civil servants, for infrastructures, for subsidies, for Singaporeans, for Singapore.

    Is this what you advocate? Please think properly before wagging. Don’t say things just for the sake of senselessly opposing.

      • more thinking please

        The statistics include foreign wages as well. The majority are foreigners, so the median wage tells nothing about Singaporean wages. Singaporeans wages in these lines are the top-end outliers. You should put more thoughts into understanding the background in the statistics before misquoting them. Don’t argue for the sake of opposing.

      • Roy Ngerng

        (1) Singapore residents does not include all foreigners.
        (2) Please ask the MOM to provide statistical breakdown according to Singaporean, PRs and foreigners, instead of lumping them together.

        Thank you.

      • eric

        Hi Roy, so the $800 salary for.cleaners are actually salaries for.both.singaporeans and foreigner lah. Did u say it’s for.both local. And Foreigner? if no how come? That’s not very truthful and open leh, u don’t expect.your readers to read the MOM. Reports which is several hundred pages u know. If u demand the govt to be more transparent, please walk the walk as well leh.
        If u really can find local cleaners who are willing to work full time for 800 please let me know!

      • eric

        Hi Ro,
        Not the first time u ‘twisted’ facts hor.

        1- you claimed transport in nordic countries is $90, which is not accurate as that’. Only for selected.bus routes in city center for 30 days, I pointed that in lathi, Norway, it’s season bus pass for 30 days it’s already £53. You compared your $90 against transit link’s $198 for all Mrt lines an all sbs/sort.bus services which most singaporeans do not buy as we spend much lesser a montg.
        2- u gave the.illusion that Singaporean cleaners only earned an average of $800, but you failed t. Mentioned it’s average of both local and foreign even.demanded that a reader.shd ask.Mom for breakdown. How come you left that important stats out?

        You bash the government, should you not look in the mirror and ask yoursel. If you have been truthful to your readers.

      • Roy Ngerng

        (2) Don’t twist the facts. Singapore residents does not include all the foreigners, quite obviously.

        And if anyone wants to know how much cleaners in Singapore really earn, please look at Lim Swee Say’s progressive wage model. How much are they trying to get the wages to start at?

        The truth is the truth. There’s only as much as words can twist it. Readers, please discern.

      • eric

        Roy oh Roy. Once again you just post some articles posted in TRS, should we singaporeans take TRS as bible? Why don’t you go to Helsinki’s transport companies n check.
        You again failed to compare apples with apples. You are better than that. Or better still, travel more. If you wanna constantly say nordic countries are so much more expensive than sg, go.ahead. It’s your ‘ reputation’ you are hurting. Just don’. Get a shock if u get to visit there some day n find prices are not in the range of Bangkok.

      • eric

        Hi Roy

        I like what u said ‘ Truth is the truth’.
        Go ask your readers how much their office cleaners earn. Full time at $800? Yes Roy. TRUTH is the Truth!

      • more thinking please

        Please read really carefully again. The wages are for all. It’s disingenuous to bring out adhoc unrelated figures for comparison if you don’t know the details and backgrounds. That includes both wages and fares.

        You like to sprinkle lots of “cheap” and “free” in your articles. The richest charities in the world are churches and temples. You need divine persuasion and solace to ensure an ample supply of alms and donations. Otherwise, you’ll exhaust your savings, live on edge from budget to budget and finally be in the red. There’s no such thing as unconditionally free or cheap things. You have to either grant a pass to heaven, ask humbly or tax.

      • more thinking please

        NTUC represents workers, regardless of nationality.

        The wages of Singaporeans can increase in 2 ways in foreign-worker dominated lines, either the government increases the levy or the employers increase the wages. NTUC is doing the latter and hence also encouraging employers to raise productivity and reduce reliance on labour-intensive processes. In other words, cutting down on manpower (specifically foreign manpower, since they will need to expend increasingly more on training at the outset).

        Get your backgrounds right first.

      • eric

        Hi Roy. Go ask how much the office aunties earn, many earn.abt $400- $500 per month, working 2-3 days a week at 3 hours each.
        Full time chambermaids in hotels earn $1400- $1800 without OT. Your stats of $800 is for cleaners from Mo. And stat board? If yes, their working hours? Other benefits? Bonus? 13th month pay? If all these add up, what’s the average? Still $800?like I said, go try looking for someone to work for 800 bucks full time.and see what’s the response is.

      • Roy Ngerng

        Thank you, Sgcynic.

        To all readers, please be discerning. There are some people out to discredit the articles and me. My reputation doesn’t matter. But it matters that you know what’s going on.

        Please do be discerning about some of the comments.

        Thank you.


    • eric

      Hi Roy
      1-Why you say ‘discredit articles’ and you? If anyone gives say comments that are not lauding, praising or bo ho tiah to u is ‘discrediting’? are you that fragile?
      2-fact is some of your facts are twisted lah. Admit it. You are in fact discrediting your readers by posting half truths, or not so nice word ‘ deceiving your readers. You are doing exactly what some are accusing the MSM of.doing, manipulation.
      3-reputation. What reputation? Are you holding some important post? Or a public figure of great standing? No one force you to write long articles and post it on the net. No one forced you yo post your photo n name. You cannot expect everyone to agree with.everything you wrote right?
      4- some of your readers call people ‘fanny puppy n to ‘f.o.’ instead of putting your foot down against bullying n name calling and supporting people’s right to openly support who they like what did you do? U just said ‘ be more discerning ‘ n how you were discredite. Are you really standing up to what you believe in? Really?

      • eric

        Does Roy need you to defend him? I don’t think so. You also kaypoh hor.

        And Roy. Are you still.condoning his behaviour of.bullying? Practice what you preach. Walk the walk. Suppression of things you do not like to hear in your sight is not what you want right.
        Not openly telling to stop? If you do not, you are no different than censorship via bullying and oppression.

      • Sgcynic

        Of course not lah, unlike those PAP OSB ministers and MPs who each are assigned a troupe of minders to defend their turf. Fighter every corner. Me, i just like to whack dog
        s for fun. Cannot be accused of animal abuse. LOL, stop whining to Roy for help leh.

      • eric

        Omg. Accusations? ROY, you allow such behaviour on your blog? Are you condoning such actions of this guy? Should you not stand up for freedom of expression without oppression? By staying silent, are you supporting hos actions?

  3. Sgcynic

    Fyi, I do make it a point to target arguments and not individuals, provided they are human. It is ok to hold opposing views, properly substantiated to the best of our efforts. Otheriwse. F.O. lah. You can go back to SACA and FAP – you feel right home there,

    • eric

      You displayed.lots of klass hor? Roy is a big boy. Do you think he need you to defend him unless you think he is a weakling that needs your ‘ protection?

  4. Jasper

    Thanks for pointing out again. To me, those levies look like income tax on the poor workers. 32% income tax! WTF.
    Imagine if the PAP government raise it to 200%. I think they should. Then those foreign workers would need to scram back to their third world country.

  5. Mr Unknown


    You make a very good case here. To answer some of the above queries, I believe the median wage could be based on 8-hour days. If you work 12 hours, can get 50% more of course. (I recently saw advertisement at food court, salary $800 for 8-hour/6-day, $1200 for 12-hour/6-day.)

    I think what is not clear enough in the article: while for a company, including the worker levy, the foreign worker is cheaper, that does not mean they can pay an SC/PR worker twice the salary. Both because they can put downwards pressure on the SC/PR wage, and because the foreign workers may feel disadvantaged.

    It would be much easier if they simply pegged the levy to the CPF rate. That would even the playing field.

  6. Opinion

    Actually Roy has good intentions. Fighting for low wage earners etc. But the problem is that his facts and data are abit dubious. He sometimes gets data from TRS as well. No self-respecting person would ever do such a thing, TRS is not a good source for anything!!! Get proper data from proper sources please. And he will always complain ‘MOM never release the statistics, please ask MOM to release statistics’. Standard Singaporean mindset. Everything also must spoon feed. Don’t have then go and do your own surveys la. And the way he interperates data is sometimes misleading as well, he will pick and choose the data that will suit his argument and reject any data that opposes it. No different than the PAP. What’s the point. Vote out PAP, then another liar come in to take the place.

    Want to be trustworthy then please be more objective la. You are so biased. Just as biased as the MSM, what’s the point? Blinded by your own sense of self-righteousness.

  7. Rachel B

    I think for lower income earners, there are work income supplement scheme to help them. Recently the cleaners’ wage has been increased, it is certainly not S$800.00. Perhaps since you are helping to push for welfare for lower income earners, you can digest this: and explain to the cleaners (as long as they are above 35 and earning less than S$1900) how to apply for it. I believe it is automatic though as long as the employers contribute CPF for them.

  8. johnson

    Perhaps Eric can publish a list of wages at the bottom 20% to prove Roy is speaking rubbish. If he can’t, then he is trolling.
    We all knew that these workers’ wages can’t keep pace with inflation, that is why Prof Lim Chong Yah came out to propose a min wage for our workers. Mind u, security guards’ basic pay is only $800 without OT; Read the news; They are trying to solve the problem.
    The wage supplement is a kind of charity from the government which is a sad thing to see. Why must our government resort to such pathetic measure but refuses to implement proper wage system for the whole country? Is it because they can’t exploit foreign workers anymore if such system is implemented?

      • johnson

        I don’t have maid. If u like to pay low wages so much, why not pay our technicians, engineers, …..the same pay as those in Indonesia, Phillipine,……..? If u want to do it, do it across the board, don’t pick & choose who is worthy or not worthy. Oh, I forgot, should pay our ministers a couple of thousands, on par with our neighbouring countries. To save cost LOL

      • eric

        I got love low pay? I am the one challenging sexispider to employ a full time singaporean cleaner for $800.
        You.go try and pay engineers the same as Indonesians if u can.

      • johnson

        I have got no time to engage in never ending arguments; Serve no purpose. If u don’t agree with the article, simply leave it. After repeated attempts to argue and not getting replies from author, u should get the message. He is not engaging u anymore because he finds u trolling. I think u have better things to do. U can’t be sure there is no Singaporean working as a cleaner for $800 either. No point arguing all these.

  9. Tan Choon Hong

    Excellent analysis and revelation of many hard truths hidden from the public. I’m inclined to believe the government profits from the importation of low wage workers more than the employers through the ingenious Worker’s Levy. All paper work, no venture risk, pure profit.

  10. Manfred Chua

    Levies, ERPs, COEs, fines, casino entrance fees, etc. are false front for authorities to solve a problem, and of course, we all know what’s the core reason behind these policies. Our country has absolutely embraced Adam Smith’s “invisible hand” in this very sense and I guess they are always looking ways to increase government revenue so as to balance out with the government spending. The levies certainly are a good looking figure for revenue I must say and I’m curious how much revenue is earned from levies every year.

    Anyway, survival of the fittest is what this country has taught me over the years and in turn, it has also taught its CEO and managers to maximize profits and improve earnings for its shareholders.

    Looking at those stats for employing a foreign worker, it’s certainly hard to justify employing foreign workers would be cheaper, but the million dollar question would be whether Singaporeans would want to work as a cleaner when those levies are turned into wages instead.

    • Roy Ngerng

      Levies collected $2.5 billion in revenue in 2012. It would have collected $3 billion last year and $3.5 billion this year.

      If the levies are passed back to low-income Singaporeans, all workers would receive more than $4,000 back in a year.

      Will publish an article today on how much wages Singaporeans are losing.

      Accounting for not just levies but other mechanisms, Singaporeans should earn at least $3,000,even in a low-wage job.

  11. Pingback: 20140620 PAP will continue to profit from low wage workers | likedatosocanmeh
  12. Pingback: 20140621 PAP will continue to profit from low wage workers | likedatosocanmeh
  13. Pingback: Come in and guess how much Bangala construction site worker earn a month -
  14. hello motto

    How much value do they get out of their employer? What what that accommodation, healthcare, food and transport cost them out-of-pocket?

  15. wahed

    recently i have got a ip from great resources M&E contructore ltd. at a fixed salary s$ 299.00 only, if this is the condition how the Government select minimum salary for workers?

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