Beneath therethoric, what has Minister Lim done as labour chief?

Click to enlarge

Finally, someone as prominent as Professor Tommy Koh has spoken up on wages in an age of disruption: “We are over-rewarding capital in Singapore and not rewarding labour enough.”

Sadly, Mr Lim Boon Heng, former labour chief and Secretary-General (who spent 26 years in NTUC with the last 13 years as Secretary- General), failed to rebut this remark by Prof Koh at the Sunday Times roundtable discussion on 30/11/18 where both of them were panellists.

Mr Lim Boon Heng’s article ‘Getting the picture right on wage share in Singapore’ should be seen as an attempt to rebut Prof Tommy Koh’s remark. By using two charts as shown above, he is hoping that he can convince the workers in Singapore that they are not getting a bad deal at all, compared to other developed countries.

Well, it is easy to fall prey to this thinking because Mr Lim’s article simply point to a fact that the wage share of Singapore workers was about 42% of GDP in 2017 (near to half) and that the wage share of GDP was fairly stable over the last three decades up to 2016. He added: “One can say that workers’ share of the pie has been well protected in Singapore.”

The first impression I had was that the Singapore workers’ earnings as a share of GDP didn’t grow much over a long period of time.

He seems uncertain that the Singapore employee compensation as a share of the GDP is a good indicator. He said: “Looking at the wage share of GDP is useful for giving an indication of the overall structure of an economy, but one has to understand the local attributes and longer-term trends.”

Unfortunately, he failed to provide more explanations and data to substantiate his thesis. Now comes the complications.

First, wage share of GDP varied from country to country, even among developed nations because the components in an economy like agriculture, manufacturing and services offer different wage share due to different value-add by sectors. “Given that the composition of an economy can change, variations in wage share do not necessarily mean that workers are getting a less or more favourable share.”

He tried to bring in more examples to illustrate this complex issue of wage share of workers in relation to capital. “Take manufacturing. When it upgrades from labour –intensive work to capital-intensive work (which was what Singapore industries were doing over the last few decades), the value-add per worker rises, but the wage share may be lower. So changes over time of wage share of GDP do not indicate changes in equity of wealth-sharing.”

Then he tried to find help from the the government website Factually to explain the wage share indicator: “Sectors with lower wage shares don’t necessarily pay lower wages. For example, our local bio-medical manufacturing has a wage share of just 5.8 per cent of value-added (the contribution to GDP made by a sector).

“But the average wage in the sector is more than two times the average wage in the accommodation and food services sectors, where the wage share is much higher at 60.5 per cent.” (Comment: comparison of the bio-medical industry with the F& B sector is most illogical).

Mr Lim tried to bring some sense back to his article by saying: “I concluded that if we want our workers to earn more, then we should have industries that produce higher value-add.” (Comment: Isn’t this what the government has been promoting and the workers have been doing for decades, to support high-skilled industries in order to enjoy higher salaries?)

Up to this stage, we are none the wiser about Mr Lim’s thesis that our workers were not short-changed by employers and investors.

Mr Lim could have proven his sincerity for labour by doing a comparison with countries having a higher rating than us and their economies and employment features are quite similar.

Take Switzerland for example: its economy is highly developed and its industries are capital intensive and high-skilled. Less than 10% of the population in agriculture, about 40% in industry, trade and handicraft and more than 50% in services like banking, assurances and tourism.

The Swiss employee compensation as a share of GDP was almost 60% compared to the Singapore employee at 42%. To state that the Singapore employee’s wage share is 42% of GDP does not mean much unless there is data to tell us how much of that wage share constituted the earning of the business owner and investor.

To inject more sense into Mr Lim’s article, let’s look at the wage share issue differently, from the ‘real outcome’ approach. If Mr Lim’s thesis has any basis to make citizens believe that Singapore labour has indeed received a fair reward vis-à-vis capital, there should be some indications from other global studies that involved Singapore.

Take the Oxfam Report released in Oct 2018. The Commitment to Reducing Inequality, compiled by non-profit organisations Oxfam and Development Finance, ranked Singapore 149th out of 157 countries – below Ethiopia, and Afghanistan and above Bhutan and Haiti. In its report, Oxfam accused Singapore of practices which encouraged “harmful tax practices”, not having a universal minimum wage (except the cleaning, security and landscaping sectors), and poor performance on labour rights.

That Singapore has extreme inequality means that the income gap between the rich and the poor is very wide and the income of the business-owners and investors is way above the median income of a Singapore employee. “Singapore is a high-income economy with a gross national income of US$52,600 per capita, as of 2017”.

Singapore’s low tax regime favours the business people and investors operating in Singapore. With a corporate tax rate of 17% and a personal income tax rate of 22% (the highest level) means even higher incomes for those who own the capital.

Singapore’s economy is not very much different from Switzerland: GDP by sector is 0% in agriculture 26.6% industry and 73.4% services (2016). Therefore, I would expect the Singapore employee compensation as share of GDP to be closer to at least the top three countries, not in 12th position. The fact that she was not means that Singapore was over-rewarding capital and labour was not rewarded enough, thereby confirming Prof Koh’s remarks.

Contrary to Singapore government’s behaviour of refuting any global studies that put Singapore in low ranking, Mr Lim has set out to convince the citizens that the present level of compensation for Singapore employee is acceptable and quite in order.

Further, the Straits Times reported on 14th December, “S’pore doing well in human capital: World Bank Report,” should once again make the island nation proud and crossed out the negative report by Oxfam. The Lee Kuan Yew School of Public Policy even saw it fit to hold a public forum ‘World Development Report: The changing nature of work released by the World Bank’.

Singapore was ranked first out of 157 countries in terms of developing human capital. It meant that the local education system has been successful in producing well-educated people who are trainable and can contribute to the economy when they enter the workforce.

To affirm the quality of Singapore’s development of human capital, a global survey of recruiters placed NUS graduates in 10th place with Harvard University at the to (Straits Times; 15/11/18).

By looking at Mr Lim’s article from a broad perspective, it seems he was trying to make right a wrong picture of Singapore employee wage share, one that has not rewarded labour enough while capital was over-rewarded.

A deeper question is: what role did NTUC and Mr Lim as former Secretary-General play in bringing Singapore labour to the present state of despair, with their wages regulated (or stagnated) over a few decades despite their quality education and training and the constant fear of losing their jobs to foreign-talents with Singapore’s open employment market?

 

Kok Meng Cheang

 

 

Sponsored Content

16 Responses to “Beneath therethoric, what has Minister Lim done as labour chief?”

  • Bapak:

    What has Minister Lim done? Very significantly – JLB, PLP & GroupThink Organizer!

    GD Star Rating
    loading...
  • opposition dude:

    It’s always the same shit from PAP over and over, one LJ report about how good we are compared to other countries and all that.

    Professor Koh isn’t wrong and so wasn’t Mr Lim Chong Yah when he said that security guards and cleaners pay have to be tripled. The fact that Workfare is around shows that a good number of people here earn far too low and have to receive monetary assistance from the government.

    So some fancy charts and a propaganda report isn’t going to fool anyone because it’s clear to see the uncles and aunties working in food courts clearing tables and collecting cardboard.

    GD Star Rating
    loading...
  • Tremendous:

    This is the issue of a certain party. They want yes-men who don’t have to understand enough about a certain subject. They want yes-men who can remain loyal to the party even when they have no performance to show. They want yes-men who are textbook smart, but know nuts what matter most to local citizens. They want yes-men who don’t mind being ridiculed by coming through GRC backdoors in elections.
    They want yes-men who are contented with income gap inequality then give token answers to citizens that it’s ok.
    I have been asking the same question earlier. What exactly are the contributions of the ministers every month or year to deserve their salaries ? If you account for their blunders, you will conclude that their compensations are not acceptable and not in order. Show your individual scorecards instead of hiding behind GRCs.
    Every time I see a person like LBH, my mind reverberates with resounding “Yes Sirs!” when his masters speak to him. I say like LBH because the bunch of members he is with are like that. Those who cannot tahan like Tan Soo Khoon and Inderjit have been shown the door.

    GD Star Rating
    loading...
  • PAP has the mandate:

    These PAP million dollars clowns are directors in many companies over, obviously a conflict of interest in protecting workers and they will never implement minimum wages as that will affect their bottom line. Wait…I thought conflict of interest is a form of corruption, maybe not in Singapore context.

    GD Star Rating
    loading...
  • LIONS:

    So the present level of ministerial salary is also correct by world standards?

    Ownself pay ownself MORE,MORE,MORE OK.
    SQUEEZE common sgs till DROP DEAD is their way of treating the voters who voted for them.

    Thrn,talk some more cock n sing a few more songs?

    GD Star Rating
    loading...
  • Salaries deflating:

    With few millions new citizens cramped in and growing fast , our truly deserving trublus are getting a much smaller piece of the pie, some none!
    Acc to pinky loong ” SG belongs to everyone”!
    Still if trublus dun vto coming GE then they are hopeless n deserve their fate…

    GD Star Rating
    loading...
  • MarBowling:

    This Cry Baby Lim Bull Heng is spewing craps through his Ar*ehole. Still can Remember his donkey look in the dispute btw SIA and the Pilot Union when he was one of JLB director of SIA BOD! Lee Kayu has to step in to help this MF from embarrassment! This MF JLB Obscene $millions ex-Minister in fact DOESN’T deserve squatting next to Prof Koh in the Shits Times Roundtable discussion on 30/11/2018! Period.

    GD Star Rating
    loading...
  • Global surveys aside:

    I once worked in an American computer multinational co. here in Singapore …. when I eventually left the industry 25 years ago, the starting pay for fresh comp. science graduates there was about $2500. These days I am told, starting salaries in this industry are under $3500. Well, that’s about a 40% rise in real wages over the last 25 years …. but HDB prices have soared in that same 25 yr period to 300-400% of the old prices. And public health care costs have zoomed skywards as well. We weren’t anywhere near the most expensive cost of living in the world that Singapore is now. The socioeconomic governance has abjectly miscalculated its priorities and principles.

    GD Star Rating
    loading...
  • Keep it simple:

    LBH should not use economics to bullshit. It is quite simple. PAP Ministers and senior civil servants are paid millions each year – the highest in the world while Singaporeans suffer from high prices, stagnant wages, no minimum wage, depleted CPF accounts, CPF money stuck in over-priced, depreciating CPF flats. The above is certainly a compelling reason for regime change. The only issue is whether Singaporeans have the spine to vote for change.

    GD Star Rating
    loading...
  • N.Jungne:

    Will Lim be replaced by CB Wan?

    GD Star Rating
    loading...
  • Underpaid:

    Shortly put, the local talents are overlooked, underpaid and over-taxed in expectations while little development/promotion paths are given to them in reality only to wait for retrenchment years coming and hence becoming a grab driver at older age. This might be the destiny of most PMETs or fresh graduates when they start working and some decades this destiny applies.
    It is ok to accept such disparity when people are blind, contented or ignorant. But such complacency cannot continue forever.

    GD Star Rating
    loading...
  • rukidding:

    Well,…for one,…he has already “collected his millions” ??

    What have you now ????

    I am sure you life isn’t any better ?..infact I believe it “got worse” ?

    Thats why “thay” call you, people “dafts” !

    GD Star Rating
    loading...
  • patriot of TUMASIK:

    The Long and The Short of it all is GET RID of the expansive pieces of SHITs and bring in dedicated MPs like we use to have…Kwik leng the young NCNP should stand for election and be an ACTIVE member she deserves MENTION!!!

    GD Star Rating
    loading...
  • NotMyProblem:

    Tremendous:

    “… Every time I see a person like LBH, my mind reverberates with resounding “Yes Sirs!” when his masters speak to him. I say like LBH because the bunch of members he is with are like that. Those who cannot tahan like Tan Soo Khoon and Inderjit have been shown the door.”

    It is not the problem of Ministers or MPs, the problem is we have idiot voters keep voting them in.

    It was these stupid voters who let the PAP thinks only they can rule. They are so arrogant to tell the voters who would be the next PM.

    Please tell me which country can do that!! The simple reason is no other country has stupid voters!! If Malaysia had the same voters as Singaporean, Najib would be still be the PM of Malaysia.

    GD Star Rating
    loading...
  • LBH:

    What have I done for my country? I’ve saved a lot of money for the taxpayer!

    You see, instead of having two cars to serve two purposes, viz. official one for my official duties and a privately bought one for all others (inc. family’s, eg. grocery shopping), I combine use of both into ONE (CAR)!

    That’s saving the taxpayer from having to buy one additional car or more cars, besides the official transport, for my wifey and our children (and her family and their own families) to fit such schedules as ferrying them to and from Changi, drop and pick up the domestic help on errand runs, etc, etc.

    So, please be grateful we did not ask you to pay for more cars for my family, especially like the Bentley or even Maytag that my wife has been fancying for along time and badgering me to (use whatever ‘conceniences’ to) snap up.

    I’ve been so wronglee and wrongfoollee accused it really makes me feel like really wanting to call it a day and exit public office, especially the very tough job of chairing one of the two national cookie jars. I feel so indignant I wanna cry but there’s no Rolls Royce our own, that I can call my own, to do such weeping in, sooooo~~~ sad leh…

    GD Star Rating
    loading...
  • Deception and illusion:

    Papies have lose their moral standing to lead yet sinkie keep sinking themselves even lower. Malaysian has in one fell scoop got rid of the blood suckers .. it high time sinkie undersrand this those million paid to host VIP should be given to our poor who daily struggle in this deceit filled land

    GD Star Rating
    loading...

Leave a Reply

 characters available

Member Services
Self-SupportMembers Login
Sponsored Advertisement

Search On TR Emeritus
Sponsored Advertisement



Most Recent Comments
  • that wouldn't make much sense: rukidding: Tharman, Iswaran,..however can stay ! Iswaran? Didn’t he come up with...
  • Daylight robbery: Its hilarious and sad at the same time to think our G is so ever ready to grab every last drop of...
  • PC Ong, don't evade question: PC Ong: Please lah, stop complaining. We got ageing population and rising health...
  • Crapy: Its really sad for us citizens here…when we became strangers in our own country! Look all around us,...
  • TRE Techie: In this matter, I am tempted to agree with the Minister that it is really not in the best interest of the...
  • TRE Techie: One thing I have learnt from my and many other’s experience in dealing with CPF is to NEVER ASSUME...
  • NotMyProblem: In GE2015, 70% voters gave PAP a blank cheque to do whatever it wanted. Let’s see in next GE, we...
  • level of ability to think: Such is the level of their ability to think. They are not able to get it right, which...
  • LIONS: In conclusion; what is the priority ? What is the point of being barking dogs but we are being pussy inside,...
  • LIONS: guess PAP CLOWNS are being nurtured at NTUC? MORE ARE BEING CULTIVATED there? next PEE-M from this stoopid...
  • LIONS: the mire you look at it,the more you notice lee ah long is treating sgs like masak-masak. he thinks he can...
Announcements
Advertisement
Visitors Statistic
Latest Statistic
Advertisements