Tripartite Members of the 2017/2018 National Wages Council

National Wages Council reveals around 150,000 in Singapore earn less than $1,300?

What’s the point of the NWC recommendations when so many low-wage workers don’t get them?

I refer to the article “National Wages Council recommends monthly wage hikes of $50-$70 for workers earning up to $1,300” (Straits Times, May 31).

The council is reported to have recommended that those earning a basic salary of up to $1,300 a month should get built-in increments of between $50 and $70.

This is said to cover 24,000 more workers than in 2017, when the NWC recommended that those earning up to $1,200 should get pay hikes of $45 to $60.

The article goes on to state, “In all, some 150,000 full-time workers will come under the new basic salary threshold”. But don’t you find it sad and rather alarming that we have so many full-time workers who earn less than $1,300*?

The council also proposed for the first time in its annual wage guidelines that companies that achieved productivity improvements last year should give their low-wage workers a special bonus of between $300 and $600. This could be paid out in a lump sum or over several payments, it said.

But what is the point of the NWC recommendations when according to the article “Fewer low-wage workers received pay rises in 2016” (Straits Times, Feb 9)  – “About 60 per cent of companies with workers earning a basic monthly pay of $1,100 and below said that they did not give, or did not intend to give, these employees wage increases last year. In 2015, only 53.5 per cent of companies had said the same.”

While about half the profitable companies which did better last year than in 2015 granted pay rises, this proportion plunged to just over a quarter among loss-making companies.

NWC’s wage guidelines for 2016-2017 also recommended a built-in monthly pay rise of $50 to $65. It is reported that about 21 per cent of companies gave their low-wage workers salary increases of at least $50, up from the 18.5 per cent in 2015 who stuck to that year’s guideline of a hike of least $60.

As one can see from the past statistics, the NWC, labour movement and the Government have all failed miserably in protecting low-wage workers.

Year after year, we see the statistics that so many companies, including those which are profitable – not giving the increments to low-wage workers.

Only about 21 percent of companies gave their low-wage workers salary increases of at least $50 (as recommended).

13.1 per cent of low-wage workers had a wage cut, 11.9 per cent had no pay increase at all, and a whopping 54 per cent had wage increases of less than the recommended $50.

From NWC’s website – How does the NWC come up with its guidelines?

In making its recommendations on wage adjustments for the year, the NWC takes into consideration factors such as productivity growth, employment situation, international competitiveness, and economic growth and prospects. Public views are also sought and taken into account when drawing up the guidelines.

A guiding principle established and observed by the NWC is that real wage increases should be in line with productivity growth over the long term. This is to ensure that wage increases are in line with economic growth and sustainable in the long run, so that Singapore’s competitiveness can be preserved and enhanced.

*Note that there are 2.26 million resident workers in Singapore and residents refer to Singapore Citizens and Permanent Residents. As it is pretty impossible to get PR if you earn a low wage, so if you remove PRs from the number of workers, the percentage of Singapore Citizens earning less than $1,300 is significant.