by Leong Sze Hian
I refer to the report “Singapore achieved record high investment commitments last year” (Channel News Asia, Jan 24). It states that “The highest value-added expected to be generated from investments here was in 2008 with S$14.7 billion”.
What does record investments mean for ordinary Singaporeans?
Well, in 2008, we had a negative real median wage growth. As a layman, I find this rather puzzling, and a paradox. What’s the point of having record investments in Singapore, and creating more than ten thousand new skilled jobs, when the outcome is negative real median wage growth?
In 2009, real wage growth was also negative, for the second consecutive year. With last year being the best GDP growth ever in the history of Singapore, at 14.9 per cent, will we see a significant real median wage growth?
Inflation for December last year, is at a 2-year high, of 4.6 per cent year-on-year.
So, if nominal median wage growth for last year is less than 4.6 per cent, does it mean in reality, that we may have a third consecutive year of negative real median wage growth?
Singaporean workers may be waiting anxiously for the release of the median wage statistics for last year, from the Ministry of Manpower. Will it be negative real median wage growth once again, or a positive one, and by how much?
According to the article, Singapore achieved “record high investment commitments last year and this momentum is expected to continue into this new year”. Does “commitments” mean the amount that international firms say that is expected to be spent?
What’s the point of the Economic Development Board (EDB) saying that it will also contribute S$14.4 billion in value-added per year to the country’s economic growth, if median wage growth is negative or very low?
EDB also said that it will “initiate and support the launch of talent and leadership development programmes to firmly entrench Singapore’s position as the home for talent in Asia”. To what extent has our liberal open foreign talent labour policies, contributed to negative median wage growth for Singaporeans, or the competitive job situation vis-a-vis Singaporeans and foreigners?
If EDB foresees “more companies such as global mid-sized enterprises looking to set up shop here”, shouldn’t that result in significant positive median wage growth?
I hope that the correlation between record investments and negative median wage growth in the record year of 2008, was just a once-off fluke event, with no causal relationship. Because, if high investments often come coupled with negative median wage growth, then maybe we should re-examine out economic growth strategies. What’s the point of attracting more and more investments, if Singaporean workers do not benefit by way of higher wages?
By the way, real wage growth over the last decade or so was only about 1.1 per cent per annum, and the bottom 30 per cent or so, of Singaporean workers may have had negative real wage growth.