He suggested that Singapore could implement “a simple, across-the-board minimum wage”. The impact on unemployment, he said, would ‘likely be very limited’.
No one-size-fits-all policy to treat all problems
Minister of State for Manpower and Education Gan Siow Huang took issue with Jamus’ assertion that the impact on unemployment would be limited.
“I beg to differ. I think under current times when businesses are being challenged and we’re in a period of recession, there is a very real risk that if we were to introduce a universal minimum wage across all sectors, I think many of our lower-wage workers may lose their jobs. From low wage, they become no wage. There are unintended consequences of some policies with good intent,” she said.
She agreed with Prof Lim that policymakers must exercise and demonstrate compassion in policymaking. In fact, that is what the government was doing and policies sometimes became very complicated because there isn’t a ‘one-size-fits-all policy that treats all problems’.
A universal minimum wage is a blunt tool
Senior Minister of State for Manpower and Defence Mr Zaqy Mohamad explained that unlike a universal minimum wage, the PWM is differentiated across sectors. There are plans to expand the PWM without turning it into a blunt tool.
As SM Tharman also explained, a minimum wage differentiated by sectors allows for the minimum wage to be adjusted so that it is not too low or too high for the specific sector.
What’s the appropriate minimum wage level for Singapore?
Mr Vikram Nair asked what minimum wage level was appropriate for Singapore and if Jamus knew of any country with a minimum wage that has a lower unemployment rate than Singapore.
Jamus Lim replied that he did not know what level would be appropriate. This seemed strange as The Workers’ Party had in their manifesto called for a minimum take-home wage of $1300. Jamus also did not know of any country with a lower unemployment rate than Singapore but he asserted that his claim of the minimum wage’s little impact on employment was based on ‘reams and reams of studies’.
Ms Tin Pei Ling wanted to know if the minimum wage was something that would be withdrawn during a recession, how much cleaners from Sengkang Town Council were paid and if he had specific proposals to improve youth employment in Singapore.
Jamus said the Sengkang team had not made decisions on a minimum wage for its cleaners. He also had no specific proposals for youth employment as he had not considered the matter in detail.
To sum up, Jamus concedes that a minimum wage is not the ideal thing to introduce during a recession. He does not know what the appropriate minimum wage should be and he has no specific proposal for youth unemployment.