Will minimum wage laws work here?

[decibel.]

1. Whether the employee can use his CPF eventually is a separate discussion and up for debate.

I'm sure the main objective of min wage law is to improve the immediate living standards of low wage workers, not 20 years later.

2. If you have noticed, a 2% increase in GST didn't increase prices by just 2% in 2007. Companies tend to round up the numbers or exploit the situation by raising prices. Again, whether this is ethical or not is for a separate discussion but the observation on the ground is that companies will increase prices, and not just proportionately.

You need to address those who will be affected as well. Like you said, every increase thus far, it is always bring absorbed by the end consumers like us.

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[Swisspers]

You need to address those who will be affected as well. Like you said, every increase thus far, it is always bring absorbed by the end consumers like us.

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Yes, the effects are far-reaching.

End consumers will definitely have to bear some or most of the increase, directly or indirectly. Whether this is the right thing to do, whether we should have compassion, whether we should advance as a society.... These are relevant questions but not my focus.

My focus is.... does min wage law actually help low wage workers? Because if it doesn't then I can't understand why it is being proposed.

A proposed $100 increase in wage is going to result in only an increase of $80 in take home pay.
Which most of it will be offset by higher costs. In fact it may not even be enough to offset the increased costs.

 

[NTB2DO]

Those countries that could do it without maids are plenty, infact which other countries can have so many elderlies having maid?

However, most of those countries, may not have the same life expectancy. One of the easiest way an elderly could die is by falling down. Singaporeans are living longer because they are simply better taken care of. There are schemes to buy grab bars, hire maids, etc. This is enough to pull up the life expectancy by quite a bit.
If minimum pay is somehow inclusive of foreigners, then life expectancy and quality of living for the old will be lower as surely a lot of people will not be able to afford hiring them. Of course the law can just exclude these foreigners to be included to the minimum wage, but that may draw a protest from various embassies and international agencies.

The only country that I think on similar grounds and did it better are the Japs, but in Japan, the old people are rich and fetches a better pay than the younger ones. The govt also pour a lot of money for them. This is unique and it's hard for us to replicate over a short term and it contains a Japanese spirit which we don't possess. Matter of fact, from PAP's campaigns and strategy, the old are often seen as the burden of the society with not much dignity or use.

As for the other countries, most have an abundant population to take the caregiver jobs. PAP's approach is to replace the declining core population with imports. Importing FT/FW does generate crazy amount of revenue for the government, look at how much levies, GST, ERP, income taxes collected from these pets. And they can micromangage who to bring in to fill which sector. They think it works from the top, but they don't see how the bottoms sees it.

As you can see, the whole system is wired to each other and they have deeper roots in the ground than what we can see on the surface. If WP wants to try tampering this system now, loosening one screw may collapse the whole thing and the blame will be on them. I will personally advise them to look into other matters or find ideas to complement the existing system, improve its efficacy than to give it a shake.

Eventually we may have to do away with maids, as the developing countries get richer. But we may still be way richer than them or we could be getting maids from other sources. Also by the time it happens, automation and AI might be mature enough to replace caregivers. Automation and AI are definitely the next big thing in the coming decades. Exoskeleton suits, home automation and many things you may never imagine now maybe become the norm in future. Just like how PMDs are suddenly appearing. The future will be taken care by the technology and people in the future.

Good analysis.

Just my observation but I could be wrong, the Japanese elderly appears to be healthier than SG elderly and are less reliant on someone else to look after them, thereby reducing the quality of caregivers (maids) required? SG's 'healthy living' is a good initiative to make our esp elderly more active, healthier and hence, less reliant on maids to look after them? Plus, of cos, as you've mentioned, exploring technologies to replace cheap labours.

Certainly all ideas have to be studied carefully, with all potential cons considered, but I disagree that we should abort the idea totally just because or kiasi-ness (in case anything goes wrong).

 

[bakuten]

I'm a strong advocate for a minimum wage. But your idea of tipping a low wage earner is quite ridiculous.

How much can you help them? You can help one, you can help all? You can help today does than mean you can help tomorrow? A social issue should be dealt with in a systematic way, a little bit here and there will get your nowhere. Seems pretty myopic to me.

Read properly first

Since when i say tipping is the right way?

Dont act like fake news only read what u wanna read and pretend everything else i wrote is invisible.

Address this.

U want minimum wage?

This i say.

Minimum wage exist in SG in the form of workfare already. You want more for it? Just adjust this scheme accordingly. Why die die must minimum wage?

So far the only argument against this i can see is. Workfare is Privatizing profits and socializing costs. Hence we must make companies pay for "exploiting" low wage earners.

To which i replied.
The companies didnt exploit anyone. They didnt force anyone to work for them for that low wage. If you have a beef to pick...u start with lookong at govt FW policies and dont just go straight to whacking the employers. Thats not solving the problem...thats just fixing the symptom.

And the moment you fight for minimum wage. You are employing the force of the state against employers who did not use force against low wage earners. That in itself is immoral....committing one immoral act to fix another immoral act will resolve nothing in the long run.

Following the above. I did point out that workfare already exist, which uses taxpayers(our money) monies to subsidize low wage earners since we feel they dont earn enough.

So when people kpkb about socializing costs. Im asking why do minimum wage pushers like you. Want to push all the duty of your "strong" beliefs onto employers?

Whats wrong with chipping in through workfare? Are you so selfish to the point that you want employers to bite the bullet so you can feel good about yourself because you did NOTHING but managed to "help" the low wage earner?

Coz you are showing me nothing when you being a "strong advocate" for minimum wage right now....doing absolutely nothing to help low wage earners when u can really make a difference to their lives by tipping them without relying on the govt.

If u did that. Then maybe i will consider your min wage argument with abit more weight.

Until then....u are just another virtue signaller. Claiming to care "very strongly" while waiting for others to pay.....when u could jolly well do it right now by tipping low wage earners(that you feel so strongly for) while we debate what is the best way to raise wages for low wage earners.

 

[NTB2DO]

1. Whether the employee can use his CPF eventually is a separate discussion and up for debate.

I'm sure the main objective of min wage law is to improve the immediate living standards of low wage workers, not 20 years later.

2. If you have noticed, a 2% increase in GST didn't increase prices by just 2% in 2007. Companies tend to round up the numbers or exploit the situation by raising prices. Again, whether this is ethical or not is for a separate discussion but the observation on the ground is that companies will increase prices, and not just proportionately.

As long as competition exists, perhaps it won't get so bad? If you raise your price too much, I'll just get it from someone else lor. Hopefully that will help keep the prices in check?

 

[wwenze]

Cleaners upskill to take up better paid job, then who be cleaners?

Just keep relying FWs ? Bearing in mind that we are able to do that only because we are more economically advanced than the FW supplier countries, ie we can use higher wages to lure the FWs to come and work for us.

But are you sure that these countries will remain undeveloped forever such that wages here in SG will perpetually be significantly higher, that we can keep capitalising on the wages difference to enjoy cheap FWs?

And is this the right way (exploiting the wages disparity between third world countries and ours) to go for, even in the long term?

Funny thing is land price can go up because people are rich.

However for example a piece of land still need one sweeper.

The price of the land increase

The price of the sweeper doesn't

Weird right

 

[decibel.]

Yes, the effects are far-reaching.

End consumers will definitely have to bear some or most of the increase, directly or indirectly. Whether this is the right thing to do, whether we should have compassion, whether we should advance as a society.... These are relevant questions but not my focus.

My focus is.... does min wage law actually help low wage workers? Because if it doesn't then I can't understand why it is being proposed.

A proposed $100 increase in wage is going to result in only an increase of $80 in take home pay.
Which most of it will be offset by higher costs. In fact it may not even be enough to offset the increased costs.

At some point in time, you will realize it's a never ending cycle. Even if the bill gets passed, with min wage in effect, there will definitely be rise in living cost or tax to cover the expense, which will end up affecting the majority including those who supposedly "benefit" from the scheme. If there will be a scenario when you have min wage (happy like finally), then realize you have to pay more, how will one feel compared to those not affected by min wage and still pay more?

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[sharpsnapper]

Look at your point #5 you assume one stall assistant will get an salary increase that cause food cost increment of $0.03 per bowl of noodles.
And then you make an assumption, because of you have bias judgement and decide that the food must increase by $0.20
In the first place why bother to do calculations??? You can pluck a number from thin air, $0.20 or $0.50 or $0.70

1. If the food stall assistant wages is $1,200, the stall owner will be paying $1,404 including 17% employer cpf contribution. The food stall assistant will take home $960 after employee cpf contribution.

2. The assumption is that this food stall only hires 1 assistant to run the entire stall by himself.
If that's the case let's assume this food stall opens on Mon-Fri for lunch and dinner, & Sat for lunch. The assistant is required to work from 10.30am - 2.30pm (Mon-Sat) and 5pm-9pm (Mon-Fri), inclusive of preparation and cleaning time.
This will be a total of 44 hours per week. https://www.mom.gov.sg/employment-practices/hours-of-work-overtime-and-rest-days
In the month of July 2020, the staff would have worked 192 hours.

3. The assumption of 100 bowls of food sold per day is unreasonably low. Let's assume the stall sells 25 bowls of food per hour, from 11am-2pm & 5.30pm-8.30pm.
In the month of July 2020, the stall would be opened for 144 hours, with an expected total of 3600 bowls sold.

4. If the min wage is set at $1,300, the stall owner will need to pay $1,521 (including 17% employer cpf contribution) in wages. The food stall assistant will take home $1,040.

5. In order to maintain the same profit margin, all things being equal, the additional price each bowl of food will need to be sold at $117/3600 = $0.0325 per bowl.
However we all know that prices will not be increased by $0.0325 per bowl. Most likely it'll increase by $0.20 per bowl, or a 6.67% increase in food price.

6. There's no point in comparing this price increase to the median wage. What's the point? You might as well compare this price increase to the highest income bracket to show no discernible impact.

If the point of min wage law is to help low wage workers, then this price increase should be measured against the wages of low wage workers instead.

Therefore, the food stall assistant is going to take home $80 more due to min wage law.

However, since each bowl of food is going to cost $0.20, then the total increase this food assistant will spend on food is $0.60 x 31 = $18.60 (3 meals a day in the month of July 2020).

So out of $80 increase in salary, $18.60 is already spent on food. How about the rest of his other spending? Town council cleaning fees go up? Telco fees go up? Transportation? School fees? Groceries? Utilities? etc etc

 

[NTB2DO]

Funny thing is land price can go up because people are rich.

However for example a piece of land still need one sweeper.

The price of the land increase

The price of the sweeper doesn't

Weird right

Ya lor, really something I also cannot fathom.

 

[Swisspers]

At some point in time, you will realize it's a never ending cycle. Even if the bill gets passed, with min wage in effect, there will definitely be rise in living cost or tax to cover the expense, which will end up affecting the majority including those who supposedly "benefit" from the scheme. If there will be a scenario when you have min wage (happy like finally), then realize you have to pay more, how will one feel compared to those not affected by min wage and still pay more?

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I'm against min wage law in case it's not clear.

However the reason why I'm against min wage law is because it doesn't serve its purpose of helping low wage workers, not because of the indirect effect it has on middle / high income ppl.

I think what you are arguing for is equality. I'm on the side of equity, but the proposals need to make sense in the first place.

 

[RAWR!!]

I had previously held a negative impression on the proposal of having a minimum wage during the GE when I briefly went through WP's manifesto. However, after reading through your discussions and arguments on the web, I came to a realisation that minimum wage may indeed work in our country.

The translation and transfer of costs is the main reason for the proposal to leave a bad taste for me and i guess for most people. Hence, let us look at the cost aspect at face value (1 tier thinking).

-
Argument 1:
Increase in cost of living as the companies will pass it on to consumers.

As mentioned, companies in singapore are hardly monopolies. As much as we interfere with the wage, we are not interfering with the free market in a macro view. Consumers are allowed to buy from cheaper alternatives. If the companies were to fail, it SHOULD fail as in a free market, capital should always be used and relocated into more productive avenues. Also, an increase in wage will not signify the same amount of increase in prices.

-
Argument 2:
Inflated wage for the employee, creating inflation.

Wage push inflation in this sense, is minimal considering only 100k people are going to contribute to this inflation. Then again, there will not be any inflation if the employee is earning the improved wage based on value. Companies are ALWAYS allowed to dismiss the employee if the employee is not performing as our main concern here is just to deter exploitation.
-

Bonus (2 tier thinking, i suppose):
Considering the effect of market forces, I do not see much negative effects as ultimately, the economy will be balanced accordingly. In fact, I see it as a way to attract more locals to take up the jobs. With more locals taking up the job assumingly, the companies will be able to expand their FW numbers, allowing companies to expand to gain the benefit of economies of scale. Should minimum sum not work in attracting locals, MOM can further adjust the FW Quotas so that the cost savings from FW could be used to pay the overpaid local. And the locals cannot complain that they cannot find "good" jobs.

I would rather implement minimum wage to let the market work its magic than going through a workfare scheme where money is passed from left hand to right hand to dont know whose hand before a certain percentage is used to help the low income workers. Also, you are increasing cost in terms of the administration of these schemes since it will go through many processes. Hence, i believe that it may actually be cheaper if the "subsidy" is done directly by the market itself.

 

[Swisspers]

Look at your point #5 you assume one stall assistant will get an salary increase that cause food cost increment of $0.03 per bowl of noodles.
And then you make an assumption, because of you have bias judgement and decide that the food must increase by $0.20
In the first place why bother to do calculations??? You can pluck a number from thin air, $0.20 or $0.50 or $0.70

Yes the $0.20 is an assumption, which I hope is reasonable. I didn't want to pick $0.50 or anything higher.

I don't carry $0.01 around. I'm not sure if you do. Esp since this is a food stall.

In the same way that takeaway containers cost $0.03 to the food stall, but they charge you $0.20 for takeaway containers (some stalls charge $0.50 or more). I'm making an assumption, and I take caution to assume on the low end and in a reasonable manner.

 

[evildoer]

Skillsfuture concept itself is fine, but they really should ensure that the course offered are relevant enough to meet market needs.

As for the elderly (old but not too old to work), not all jobs require high level of literacy, off hand I can think of is child-tending job eg help looking after children in childcentre by say preparing their meals, or looking after older folks in aged home, etc.

i am ready quite surprise that child tending job do not need high level literacy..
i can remember a case that happen years ago .. the grandfather and his grandchild go convenience shop .. they bought a pack of mothballs , they come in little ball with all sorts of colors.. thinking it was candy.. the child did not survive..

Children are super high energy.. taking care of their own grandkids.. some grandparents already given up. i do not think elderly can cope with handling a group of children... lol

 

[NTB2DO]

I'm against min wage law in case it's not clear.

However the reason why I'm against min wage law is because it doesn't serve its purpose of helping low wage workers, not because of the indirect effect it has on middle / high income ppl.

I think what you are arguing for is equality. I'm on the side of equity, but the proposals need to make sense in the first place.

Your are aware that SG is rare few of the developed world that does NOT have min-wage law?

If the min-wafe concept is that bad, why is it adopted by most (if not all) first world countries?

 

[Swisspers]

It would be naive to assume that just because the cost price is $0.10 to the company, they would only charge $0.10 to the consumer.

 

[NTB2DO]

i am ready quite surprise that child tending job do not need high level literacy..
i can remember a case that happen years ago .. the grandfather and his grandchild go convenience shop .. they bought a pack of mothballs , they come in little ball with all sorts of colors.. thinking it was candy.. the child did not survive..

Children are super high energy.. taking care of their own grandkids.. some grandparents already given up. i do not think elderly can cope with handling a group of children... lol

You know it's very common for grandparents to look after grandkids both in the past, and now?

So how? Like that better don't make grandparents look after the kids, esp if grandparents are illiterate, hor.

 

[decibel.]

I'm against min wage law in case it's not clear.

However the reason why I'm against min wage law is because it doesn't serve its purpose of helping low wage workers, not because of the indirect effect it has on middle / high income ppl.

I think what you are arguing for is equality. I'm on the side of equity, but the proposals need to make sense in the first place.

It's both, unless one can ensure the introduction of min wage will not lead to a disproportionate increase of living costs or taxes. If by having min wage means you have to pay more to a point when the net difference between the new living cost and your wage increase due to min wage law is $0, it makes no sense to have it in the first place.

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[sharpsnapper]

Yes the $0.20 is an assumption, which I hope is reasonable. I didn't want to pick $0.50 or anything higher.

I don't carry $0.01 around. I'm not sure if you do. Esp since this is a food stall.

In the same way that takeaway containers cost $0.03 to the food stall, but they charge you $0.20 for takeaway containers (some stalls charge $0.50 or more). I'm making an assumption, and I take caution to assume on the low end and in a reasonable manner.

I say again, you calculated food cost increment of $0.03
And you said food cost will go up by $0.20 because that is your assumption.
I can only face palm at how you want to prove your point. If a person use assumptions, assumptions and assumptions to argue on something. You better be salesman, say anyhow also can.

 

[theMKR]

That's why you still need to upskill and have a Singaporean first policy that gives priority to Singaporeans instead of balancing it out with foreigners. The current scale is tilted to which side, I believe everyone in the mix would know.

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very very few policies to help sinkies upskill beyond the 6-7k pay scale.....

 

[decibel.]

It would be naive to assume that just because the cost price is $0.10 to the company, they would only charge $0.10 to the consumer.

This is never the case, there will always be a bigger margin for profit, which is why I worry as a consumer.

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