On Saturday, June 9th 2012, 45 members of the public gathered at the National Volunteer And Philanthropy Center to discuss a hot topic that has been close to many Singaporean hearts of late: The need for a Minimum Wage.
The 3 hour forum was organized by Gilbert Goh of Transitioning.org, a support group for the unemployed of Singapore. The discussion was headlined by Singapore Democratic Party treasurer, Dr. Vincent Wijeysingha, Leong Sze Hian, ex-President of the Society of Financial Service Professionals, Kumaran Pillai, Chief Editor of The Online Citizen, Mr Wei Chan, a business owner and Jolovan Wham, a social worker.
Business owner Mr Wei Chan began the discussion by laying out the challenges a Singaporean business would face if there was a minimum wage law on the books. Mr. Wei pointed out that the 2 highest costs that local business owners face are rental and labor costs. Mr. Wei went on to say that although he makes the effort to pay his employees a fair wage, a minimum wage would drive his business costs up, forcing him to raise his prices and pass the costs onto the consumer.
Dr Wijeysingha interjected that businesses are further burdened by high transport costs and foreign worker levies in addition to high rent and labor costs. Dr Wijeysingha said that the government has control over the previously mentioned 4 cost areas but it has refused to actively do anything to curb them. He said that the government’s free market approach has transferred the burden onto business owners such as Mr. Wei, who generate the national wealth, despite the struggles they face on a daily basis.
“They (the business owners) are then ironically forced to justify government policy by saying the minimum wage shouldn’t be allowed while it (the government) steps back and allows the argument to be constructed by the business owners.” Said Dr Wijeysingha.
Mr. Wei then proceeded to point out that the government’s mantra of raising overall wages through productivity increases is flawed. He said this is because the government’s focus on productivity is merely a numbers game that is focused on increasing output exponentially. Mr. Wei related an anecdote about how someone suggested that he should install a tunnel oven which could produce about 1000 cakes per hour in his bakery, greatly raising his bakery’s productivity as a result. It was an idea that Mr. Wei quickly shot down. Mr. Wei explained that on his best day, he could only sell 50 cakes a day. Mr. Wei also mentioned that he does not have the space in his premises to even install a tunnel oven, let alone use one.
“At the end of the day, we are still worried about whether we can pay the next pay cheque to my people and whether we have enough profit to cover my running of my business.” intoned Mr. Wei.
Following on Mr Wei’s points, Dr Wijeysingha told the audience present that the general population’s misconception of the minimum wage needed to be cleared up. “The concept of the minimum wage is only for the lowest paid workers. We are not saying we should pay lawyers a minimum wage of $50,000 a month…we are talking about those right at the bottom that can earn as little as $1.80 per hour… these are the people that need a minimum wage.”
Mr. Wham reinforced Dr Wijeysingha’s point by outlining the work conditions faced by low wage workers in Singapore. Wham shared that he had encountered cleaners who only have 2 days off a month, despite the Employment Act guaranteeing a weekly day off for these workers. He added that there are many low wage workers in Singapore who work a 12-16 hour day. This is despite the fact that under the Employment Act, these workers are not allowed to work more than 72 hours of overtime per month. Mr. Wham’s story was corroborated by most of the other panelists when they shared what they learned when they asked hawker center cleaners about their work conditions.
Mr. Leong told the audience that many low paid waiters he used to encounter at local food and beverage outlets were Singaporean. However, the jobs that these Singaporeans used to do are now mostly held by foreign exchange university interns working on their internships in Singapore. Mr. Leong said that local employers like to use interns at their establishments because the interns do not count towards their employers’ foreign worker quota. This allows the employers to utilize as many interns as they like.
“If you’re an employer you can get this slave for six months for $450 per month and the slave will work extremely hard because they want a good performance review so they can get a good grade for school.” disclosed Mr. Leong.
Dr Wijeysingha then touched on the plight facing another group of low wage workers in Singapore: foreign maids. Dr Wijeysingha said that some maids in Singapore work as much as 19 hours per day with no day off at all.
“After the levy they (the maids) have to pay is deducted from their salaries…they practically make 20 cents an hour. How many people here are willing to work for 20 cents an hour?” questioned Dr Wijeysingha only to be met with silence from the audience.
Mr. Wham chimed in and spoke about the foreign worker situation. Mr. Wham talked about how the $5000 security bond (separate from foreign worker levies) that employers put up for their workers end up causing the same employers to view and treat their workers as “property”. Mr. Wham explained that this attitude causes said employers to see their workers as commodities to be controlled and it leads workers’ personal liberties to be severely curtailed by their employers.
“When we don’t have a culture that respects workers’ rights in general, and the issue of low wages is an important component of this culture, then all low wage workers will suffer. The reason why local workers are displaced is because migrant workers are easy to exploit." Said Mr. Wham.
Mr. Wei then said that cheap foreign labor will become an inevitable fact of life as Singapore and Singaporeans progressed. “Our society is moving up and there are jobs that you and I do not want to do. If you ask me to clean toilets, I wouldn’t want to! We need these foreign workers to come in and help us to do the minimum service that we want so that our costs can remain low. Without all these foreign workers, the very jobs that we’re trying to save at the higher levels will go off." explained Mr. Wei.
“The idea that there are some jobs that Singaporeans do not want to take up is patently untrue. The issue is not because we are too high and mighty to do what some consider low status jobs, the issue is because we cannot live on the low wages that these “low status jobs” pay. IF you’re paid $1.80 an hour, before you go and come back to work you’ve already spent all your pay. You go to our hawker centers you will see that the ones who are working as the table cleaners…they are our own people. Our elderly who are still working.” Countered Dr Wijeysingha.
Mr. Leong then pointed out that the unemployment rate of cleaners, laborers and general workers in Singapore is extremely high when compared to all occupation categories. Mr. Leong said that this is because many of these low wage Singaporeans are displaced by cheap foreign labor: “When you don’t have a minimum wage and you have liberal foreign labor, your Singaporeans lose their jobs and cannot even get the same cleaner job they’ve been doing all these years!”
Mr. Leong then touched on wage inequality by disclosing that local division 4 civil servants previously made between $800 plus to $1100 plus per month. After the government announced a pay increment of $60, the division 4 civil servants now make about $900 plus to $1100 plus per month. Mr. Leong said that the gross take home pay for these workers after CPF deduction is approximately $700 month. “We have the highest paid civil servants in the world. But we also have the highest ratio between the highest paid to the lowest paid civil servants in the world!”
Dr. Wijeysingha supported Mr. Leong’s point on wage inequality in Singapore by adding: “According to Jacqueline Loh of the Lien center for Social Innovation, Singapore has the highest GDP in the world in terms of purchasing power parity, higher than even the US. In terms of wealth per adult we are the second highest. In terms of gross national income, we are the 10th highest in the world. These are statistics we should be proud of. What we shouldn’t be proud of is the corollary statistics: We have the highest gini coefficient for inequality in the world.”
The forum ended with Mr. Leong’s final words to the audience: “Minimum wage is not a debate. Minimum wage is not something for us to write and talk about. Minimum wage is all these people (low wage workers) struggling to make ends meet.”