This is not the first time in recent years that the National Wages Council (NWC) has proposed increased salary for low-wage workers. NWC also recommended a S$60 increase in 2013 and 2014, and S$50 in 2012, But the recent recommended wage increment of S$60 for low-income workers earning S$1,100 or less monthly by the National Wages Council has set tongues wagging, with many commenters stating that such an increase is too paltry to make a difference, and others calling – once again – for minimum wage to be installed in Singapore. Not to mention that since it’s only a recommendation, some companies might not feel compelled to follow this guideline.
I used to be a huge supporter of minimum wage, and I still am. However, since living in a city that imposes a minimum wage of around A$16 per hour, the drawbacks are more apparent.
For one thing, the lack of minimum wage has kept prices mostly low in Singapore. The cost of paying employees a required basic sum has to be taken on by one party or another, and this often translates to increased prices of goods and services. Imagine being paid $16/hour to sell mixed rice at a food court – I’m sure that many Singaporeans would be more than willing to take on this job. But then imagine having to pay $7.50 for rice and two dishes. Not such a nice trade off, after all.
Besides higher cost of living, another very real problem that minimum wage could be the possibility of employers underpaying workers who desperately need money and are willing to work for less. With the job market in Singapore so saturated and so many complaints about how foreign workers are willing to work for less pay, this scenario might end up playing out to the disadvantage of local workers.
In Britain, for instance, soldiers fighting on the frontline are earning less than the minimum wage that workers such as cleaners or fast food outlet employees earn. The risk and skill required by each worker doesn’t always translate to getting paid a better salary then.
Singapore’s progressive wage system sees workers getting paid according to their skill level, which allows different workers with different skill-set to be paid accordingly. Of course, the recommendation produced by NWC still leaves workers’ salaries to the mercy of whether or not employers want to follow this guideline, but statistics show that the percentage of low wage workers have decreased somewhat. In the grand scheme of things, S$60 isn’t much, but for these low-wage workers, I think any increment would be welcomed. Perhaps what the NWC should do is to find ways which working conditions for these workers can be improved, or to provide incentives for companies to follow these recommendations to increase the salary of these low wage workers.