The Low Wage Conundrum

Temasek Review
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The article below has been submitted by Fawkes Gee

There has been a lot of talk over the past year about low wage workers. Some advocate minimum wage laws to ensure their lot is increased, whilst the NTUC say there should be a way to improve their salaries with increases in skillsets and productivity.

I am a layman and I think I am not as smart as the many scholars working in the government and stat boards. But if I use my common sense and look at the issue, it is really not rocket science.

When I was in primary school the school cleaners were all hired by my school. My principal would be the one dealing with their benefits and employment issues, including leave, medical and most importantly salaries.

Somewhere in the 80s and 90s, Singapore went into a hyper outsourcing drive, with many Ministries outracing themselves to outsource their non-essential services to contractors. Why? Other than to focus on doing what they are supposed to do and do it well, the main thing was to manage costs. What does this mean? It means that contractors can do the job better, since it is their full time “tan-jia”, and also they can be more productive. This assumption is flawed. Why? Because if I am the tow-kay running the SME providing cleaning services, where do you think I will start cutting costs? Buying expensive machinery to lower my manpower needs over the long run? Don’t be silly. I will cut or freeze my workers’ salaries. Most immediate, most effective.

Which is what has happened over the years. School cleaners got $600 10 years ago. They get $600 today. They are low wage workers who work with no bonus, no medical and no leave. This is very sad. But the saddest thing to me is – surely anyone can see how best to solve this immediately? Why can’t the MOE re-hire all these cleaners, many of whom are 60 years old and above? Why can’t the government provide secure employment for them, after all, they are still working and not dependent on welfare?

A friend of mine came back recently from China. She landed at Changi and proceeded to the belt to wait for her luggage. Changi is internationally renowned for many things, including the reputation of our luggage appearing on the belt before you even reach there. But my friend’s experience? 30 minutes before the belt started to turn. What has this got to do with the cleaners’ experience above?

Well, the Singapore Airport Terminal Services (SATS) also went through the said outsourcing activities. The baggage handlers were outsourced to contractors – so doing the same job before and after, yet lower pay and benefits. So whereas before they could be motivated with incentives to put the baggage on the belt fast, now there is no incentive to do so, since any incentive is passed on to the contractor, not them. So? 30 minutes wait at the belt and no more reputation to behold. Sad, again.

So I think the government agencies have to get their acts together and set the right examples starting today. Outsourcing does not work in every area and let’s not be so out of touch any more. I urge the government to play its part and help our fellow workers today.

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