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Legislate $1300 as the minimum and have your pay reduced to $1300

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Legislate $1300 as the mandated minimum wage and you will see 32,000 workers get a pay lift?

Ya, right.

In this current economic climate, the Government is paying a portion of salaries of 1.9 million Singaporeans through the Job Support Scheme in order to save your jobs. This support cannot go on indefinitely.

The National Wage Council has also given employers the green light to make temporary pay cut to staff’s salaries in order to save jobs.

Legislate $1300 as the minimum and you will more likely see those earning $1350, $1400, $1450 etc, who are not covered by the Progressive Wage Models, get their pay permanently cut to $1300.

Why should an employer pay you more than the minimum unless you are a very productive worker?

Wages are determined by the market.. They are not determined by politicians who have nothing to do with the market.

They are determined by supply and demand, by the needs of the industries, and by workers’ skills and productivity.

The way to help workers earn more is not a simplistic process of just setting an arbitrary wage as the minimum.

That’s simply lazy. Populism always calls for simplistic solutions without careful considerations of their implications and ramifications.

A relative of mine has a daughter who, because of meningitis, went into a coma for 2 weeks, and suffered brain damage. She is permanently on a mental block unable to process information beyond very simplistic thinking. Out of the kindness of some people, today she is employed to do the very simple tasks of sticking postage stamps to outgoing mail and sorting incoming mails to their respective departments. That’s all she does.

Imagine she gets $1300 take-home pay, or the equivalent of $1625 before CPF deduction, or $1901 inclusive of employer’s CPF contribution just sticking postage stamps and sorting mail.

What would her colleagues who are taking on more responsibilities think? Would they not expect their pay to be higher than $1901?

Populist politicians like to project themselves as people who care. They love words loaded with morality. But if they truly care and if every worker truly matters, they would have taken time to understand how every worker is different and what can be done to support the workers.

If minimum wage is the magic solution, the government would have adopted it a long time ago and make themselves very popular. After all, they are not ideologically opposed to a minimum wage.

A blanket minimum wage has unwanted consequences. This is why the Government has chosen to do a sectoral minimum instead of a blanket minimum.

Good, sustainable solutions take time to work out. The are not hurried without ground work.

By Qiuyan

Reference:

  1. National Wages Council (NWC) 2020/2021 Supplementary Guidelines
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