Mr Tan,
I like to seek your views.
Some countries have a minimum age policy. But there is no such policy in Singapore. The reason, I understand, is that a minimum wage policy will push investors to to other countries. Do you agree?
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My reply:
I am in favour of a minimum wage policy. A minimum wage will provide the worker with an income that is sufficient to make a decent living.
If there is no minimum wage, the market forces may push the wage to a low level. Our workers have to compete with foreign workers who are willing to come to work in Singapore at a low salary. The cost of feeding their family in their home country is low.
Foreign investors look at the total cost of operating in a country. The total cost comprise of:
* wages
* land
* other costs (eg inefficiency, tax, levy, corruption)
Our economy is quite efficient and corruption is not a problem. We are quite competitive to foreign investors. If wages go up, it can be compensated by a lower cost of land. The total cost can remain quite competitive.
By keeping the wages low, we are largely benefiting the land owners. This is why the cost of land is so high in Singapore.
In my view, we should raise our wages, especially at the lowest level. This is improve the living standard in Singapore. Our people do not have to work long hours, can have more time to be gracious, and maybe raise a bigger family.
Dear Mr. Tan,
ReplyDeleteI enjoy reading your blog. It is like reading a live newspaper and sometimes, I many times,I find it very inspiring...
With regard to this post, I do agree that we must have a minimum wage. But how much is just nice? $6/hr? $8/hr?
This will drive cost up. Do you know how much an auntie/uncle is being paid for working behind the counters of McDonald's?
If we set a minimum wage, I am sure we will no longer be able to get our meals at less than SGD6.
You know, I am really concerned at the way our country is heading. Is there really a day where we can really really retire and not having to worry on how we are going to live our lives once we are unemployed?
Do we have to work until the day when we kick the bucket?
Honestly, I really do not want to see myself working behind a McDonald's counter for minimum wage when I am 50 or 60 years old.
It is just too unbecoming on what we are aspiring to be, to be a world class city,.. ... Like there is no end, besides, work, pay your bills, sleep and read people's blog.
If the workers get a higher wage, and the customer continue to pay the same price for the hamburger, it means that the rental will be lower.
ReplyDeleteLower wages means higher property prices and rental rates.
We have to achieve the right balance.
The argument is flawed. If wage is higher, doesn't mean that Property Owner will lower Rental Charges to compensate Fast Food Chain so that they can maintain same SGD6 selling price. It only held true if the hamburger seller has the control over the rental charges. Unfortunately, both rental rates and property prices are not within their control. Wages unfortunately is...
ReplyDeleteIn Western countries, when there are higher wages, the property values are not as high as in Asia (on a proportionate basis).
ReplyDeleteWages and property values have a way of compensating each other at the macro level, and over a period of time.
It does not work in the way envisaged by Sentosa.