The Singapore General Election will be held on 11 September 2015.
Has the current ruling party, the People’s Action Party (PAP), done its job or has it hurt Singaporeans instead?
Over the next two weeks, I will be compiling the past articles that I have written into the different thematic areas, so that you can see for yourselves if the PAP has helped Singaporeans or if it has actually make lives more difficult for Singaporeans.
In today’s article, the focus is on WAGES.
You can click on the red headers below to read more of each of the articles.
Singapore is today one of the richest countries in the world (by GDP per capita) and the most expensive, so one might expect Singaporeans to also earn one of the highest wages.
However, in a survey that Gallup did at the end of last year, it was found that among the top 20 richest advanced economies, Singapore has one of the lowest self-reported per-capita household income!
Not only that, when you compare how much the lowest-wage Singaporeans earn as compared to the other countries, Singaporeans also earn the lowest wages! The PAP government has refused to set a minimum wage to protect Singaporeans but the $1,000 they are finally willing to give to cleaners can be seen as a de facto minimum wage. But even then, this is only $1,000.
When you compare this to other countries with a similar level of wealth and cost of living, the lowest wage workers in Norway earn $5,000 and those in Switzerland and Australia earn $3,000 – the difference as compared to Singapore is massive! If Norwegians, Swiss and Australians need to earn $3,000 to $5,000 to be able to survive on their high cost of living, how can Singaporeans expect to be able to survive on only $1,000 for a similarly high cost of living?
Singapore stands in stark contrast to the other countries in the “same league”, where the governments in these countries would share in the wealth of the nation, so that the poor in the country wouldn’t be left out. Singapore is indeed an anomaly and the only country among the other high-income countries where the government continues to take the wealth contributed by the people, without sharing it back. As such, the poorest in Singapore have only seen slight increases in their nominal wages, but when factoring for inflation, their real wages have actually dropped.
The government can try to come out with all sorts of ways to paint a nicer picture but the fact of the matter is that the lot of the poor has gotten worse and this is not something that the PAP can run away from, just by putting up another set of statistics that would tell the story that they want people to hear. Also, for Singaporeans who have to live with one of the highest prices in the world, we are being paid wages that cannot possibly allow a respectable standard of living for the most of us.
Singapore has the lowest wages and lowest wage growth among the developed countries!
Compared with cities in other developed countries, Singapore had the second lowest wage level.
Not only that, Singapore had the lowest hourly pay in manufacturing in 2010.
Not only do Singaporeans have the lowest wages, our real hourly compensation (in manufacturing) also grew the slowest and actually became lower than in 2002.
According to the International Labour Organisation’s Global Wage Report 2008/09, between 1995 and 2000, Singapore actually had one of the highest average real wage growth among the developed countries, at 5.75%. But from 2001 to 2007, this dropped to only 1.8%.
In fact, you can see that between 1995 and 2000, Singapore’s average real wage growth had followed the GDP annual growth closely, but between 2001 and 2007, our real wage growth fell way below the GDP annual growth.
So, do you see the whole picture now?
- First, the government doesn’t pay the right wage that they should be paying you – only 42% of GDP goes into your wages. If we are paid what we should be paid, the median income earner in Singapore should be earning $6,139.
- Second, use the CPF to entrap your money so that not only are you paid terribly low wages, the government cuts up this low wage of yours and use it for their own investments, and return very little back to you, and at the same time, make you use your CPF to pay for your house and siphon even more off from you.
Now, to be very clear, this entrapment exercise mainly affects the low- and middle-income Singaporeans.
For high-income Singaporeans:
- They are paid the highest wages among the high-income countries.
- The personal income tax that they pay are more likely to be returned back, as it doesn’t get as entrapped as the CPF.
- They are much less affected by CPF than the rest of Singaporeans are, and the much smaller CPF contribution rate is something that is easier to live with, since they are compensated by the higher than should-be income that they should be earning.
However, note that this is by no means a fault of the high-income earner. This is a critique of the system that the PAP has created more than the individual earner.
And if you look at how much each of the income groups are losing in wages today, the low-income earner is losing $2,399 of his/her wage, or 3 times his/her current wage. The middle-income earner is losing $2,889, or almost the whole wage he/she is earning now. And the high-income earner is getting an additional $1,717 more than what he/she should be getting now.
Do you know that because prices have been driven so high in Singapore and wages have been depressed so low by the PAP that Singaporeans now also have the lowest purchasing power among the developed countries?
Also, do you know that even though Singapore’s GDP per capita is higher than Japan, Hong Kong, South Korea and Taiwan, our purchasing power is actually lower than all of them?
If fact, do you know that Singapore has a lower purchasing power than even Malaysia and has a purchasing power similar to India?
Wait a minute! I thought that the government has always said that if we impose minimum wage, our economy will collapse and businesses won’t want to invest in Singapore?
Then why is it the case that the countries with the highest minimum wages are also one of the richest countries? Why are businesses still investing in them?
You see, the reason why the government doesn’t want to impose a minimum wage law isn’t primarily because businesses won’t invest. There are many businesses which have gotten used to the ethical practices of the other developed countries, and they would do what they need to, to respect the laws in those countries. The reason why there’s no minimum wage in Singapore then? Well, for the Singapore companies owned and based here, where do they predominantly earn their profits from? If they increase our wages, where will their profits go to? So, in order to earn from you, they have to depress your wages and increases prices, so that they can earn as much as they can.
And who own this Singapore companies?
(7) Poor Singaporeans Have to Work for 272 Years to Earn What the Singapore Prime Minister Earns in One Year
For a Singaporean who earns $1,000 a month in Singapore (or the de facto minimum wage given to cleaners), it would take him or her 272 years to earn what the prime minister can fully earn in a year today.
And if you look at the median income earner who earns $3,705 (when including for employer CPF), he/she would need to take 73 years to earn what the prime minister gets to earn in a year.
Of course, seeing that our CPF is as good as gone, if you take the median income of $3,250 (without including employer CPF), an average Singaporean would need to take 84 years to earn what the prime minister gets to earn in a year – which means that if Singaporeans were to start working once we are given birth to, even if we work our whole lives until we die, we would still never earn as much as what the prime minister can potentially earn today.
In 10 years, the prime minister would have easily earned $30 million. For a low-income Singaporean who earns $1,000, it would take them 2,500 years to earn what the prime minister would easily earn in 10 years!
To give you a bit of perspective, if you look at another country, say Norway, which has a similar level of wealth and GDP per capita, and prices as Singapore, but where its workers are paid much fairer wages, for the lowest-income workers who earn $5,000 every month ($60,000 in a year), it will only take them 5 years to earn what their prime minister earns ($300,000 in a year). And by the way, they already consider what they pay to their prime minister “a lot of money”.
And for the median income earner in Norway who earns about $8,000, it will take about 3 years.
This is in comparison to the 272 years and 84 years that it would take low-income and median income Singaporeans to earn.
The PAP has run its course for us. It is no longer what Singapore and Singaporeans need. It is clear that they have hijacked government for their own purposes and if we do not rid our government of this scourge that is the PAP, our country and the survival of Singaporeans is at stake.
It is up to Singaporeans to wise up to the reality, to realise the implications and to do what’s right for ourselves.