Read this http://www.mint.com/blog/trends/minimum-wage-08032010/
My view
A minimum wage is necessary to ensure that the lowly paid workers earn enough to be above the poverty line and should be adjusted to the cost of living. It is necessary to protect workers from being exploited due to their weak bargaining position. I remember that Hong Kong has a minimum wage. Singapore is among the few developed countries that still do not have a minimum wage.
Dear Mr Tan,
ReplyDeleteLKY has publicly said that he is against minimum wage in SG. Unless LKY passes away, minimum wage will not materialise.
I do believe that Singapore should have minimum wage policy. It should not be difficult for the govt to implement since govt collect lots of statistics.
ReplyDeleteThe competitiveness environment can still be managed by taxes and also tightening the huge bonuses given out to managed the overall cost of business.
There is the issue of illegal workers
ReplyDeletewho are willing to do work for a lower salary, thus competing with workers who have to be paid a minimum wage.
We will have same problems as USA & Mexico
The levy is a good tool to even things out. However, the monies collected through this means should be seen to help citizen workers. Not lumped together into the CPF.
It could be used as an incentive for workers to retool their skills
via subsidy for courses or a graduated scale of payment to attract workers to inventorise their abilities.
Minimum wage is a double edged sword.. its success depends on the mechanism & enforcement. Not an easy task yet a doubtful benefit over the longer term.
HK just passed legislation for minimum wage in July 2010. However the quantum of the MW and the frequency and method of adjustment (e.g. based on cost of living / inflation) is still being debated.
ReplyDeleteIn Singapore, having a decent minimum wage that is based on realistic subsistence requirements in our high-cost-of-living society will destroy the market for foreign workers and start to raise wages for the rest of the lower-middle to middle-income earners. This will destroy many SMEs and MNCs that depend on cheap foreign labour -- or at least make a major dent on the profit margins of many big companies.
Our govt knows this. In the earlier years of 70s and 80s, their main concern was scaring away foreign investors & MNCs, thus depriving Singaporeans of jobs and having high unemployment. That's why historically PAP has always been against MW.
Today, it would appear that the concern has shifted towards maintaining high GDP growth, and that any brakes being applied to cheap workers will mean lower GDP.
Of course, GDP figures directly impacts some peoples wallets and bank accounts.