Decling median wages in Singapore

http://theonlinecitizen.com/2011/01/record-investments-negative-wage-growth/
by Leong Sze Hian

I refer to the report ?Singapore achieved record high investment commitments
last year? (Channel News Asia, Jan 24). It states that ?The highest
value-added expected to be generated from investments here was in 2008 with
S$14.7 billion?.

What does record investments mean for ordinary Singaporeans?

Well, in 2008, we had a negative real median wage growth. As a layman, I
find this rather puzzling, and a paradox. What?s the point of having record
investments in Singapore, and creating more than ten thousand new skilled
jobs, when the outcome is negative real median wage growth?

In 2009, real wage growth was also negative, for the second consecutive
year. With last year being the best GDP growth ever in the history of
Singapore, at 14.9 per cent, will we see a significant real median wage
growth?

Inflation for December last year, is at a 2-year high, of 4.6 per cent
year-on-year.

So, if nominal median wage growth for last year is less than 4.6 per cent,
does it mean in reality, that we may have a third consecutive year of
negative real median wage growth?

Singaporean workers may be waiting anxiously for the release of the median
wage statistics for last year, from the Ministry of Manpower. Will it be
negative real median wage growth once again, or a positive one, and by how
much?

According to the article, Singapore achieved ?record high investment
commitments last year and this momentum is expected to continue into this
new year?. Does ?commitments? mean the amount that international firms say
that is expected to be spent?

What?s the point of the Economic Development Board (EDB) saying that it
will also contribute S$14.4 billion in value-added per year to the country?s
economic growth, if median wage growth is negative or very low?

EDB also said that it will ?initiate and support the launch of talent and
leadership development programmes to firmly entrench Singapore?s position as
the home for talent in Asia?. To what extent has our liberal open foreign
talent labour policies, contributed to negative median wage growth for
Singaporeans, or the competitive job situation vis-a-vis Singaporeans and
foreigners?

If EDB foresees ?more companies such as global mid-sized enterprises looking
to set up shop here?, shouldn?t that result in significant positive median
wage growth?

I hope that the correlation between record investments and negative median
wage growth in the record year of 2008, was just a once-off fluke event,
with no causal relationship. Because, if high investments often come coupled
with negative median wage growth, then maybe we should re-examine out
economic growth strategies. What?s the point of attracting more and more
investments, if Singaporean workers do not benefit by way of higher wages?

By the way, real wage growth over the last decade or so was only about 1.1
per cent per annum, and the bottom 30 per cent or so, of Singaporean workers
may have had negative real wage growth.


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