I refer to the “Budget Debate Round-Up Speech” by Deputy Prime Minister and Finance Minister Lawrence Wong during the Budget 2023 debate on Friday (24 Feb).
Mr Wong stated, “Median household real income growth in Singapore over the last decade was 3.2% per annum. It is higher than what the middle-income in the US and most other European societies experienced, and well above other Asian societies like Japan and Hong Kong.”
Based on government data, Real Median Household income only increased 1.8% per annum from 2000 to 2021.
Mr Wong also said, “As I highlighted in my Budget Statement, our moves to uplift lower-wage workers through Workfare and Progressive Wages are showing results. Over the past five years, our lower-wage workers have consistently seen higher income growth than those at the median. So we will continue with our efforts to uplift the incomes of lower-wage workers. Last September, we expanded the Progressive Wage Model, or PWM, to workers in the retail sector. Next month, workers in food services, as well as administrators and drivers will come on board. Come July, we will cover workers in waste management. Taken together, our Progressive Wage approach covers the vast majority of lower-wage workers. Thus, the moves we are making will have a positive impact on uplifting their salaries over the coming years.”
However, according to the latest figures, admin assistants’ real minimum income decreased, negative -2.7% p.a. over the last 21 years.
Just imagine that your real pay may have been decreasing yearly for the last 21 years!?
The median gross monthly income from work (including employer CPF) of full-time employed resident Clerical Support workers was $2,088 in Jun 2001 (I can’t seem to find the income of administrative assistants in Jun 2021, and “Clerical Support workers” are the closest occupational group definition to “administrative assistants”).
So, based on the minimum income of $1,500, from 1 Mar, the decrease in minimum income (now under the Occupational Progressive Wages (OPW)) in the last 21 years was about -16.7% ($1,500 (excluding employer CPF now) divided by median income $1,800 ($2,088 less 16% employer CPF Jun 2001)).
Given that inflation was about 47.9% (CPI 111.2 Dec 2022, 75.19 Jun 2001), the negative real decrease in minimum income in Mar 2022, compared to the median income in Jun 2021, was about -2.7% p.a., or about a negative -$48.60 per year, in the last 21 years.
According to Mr Wong, “We are also focusing on new entrants to the workforce, especially our ITE graduates whom Mr Desmond Choo and others spoke about. We are equipping them with industry-relevant skills and a strong foundation for future learning. In fact, through programs like the Work-Study and Technical Diplomas, ITE graduates are seeing better employment outcomes, with median starting salaries comparable to those of Polytechnic diploma graduates. So these are positive indications, and we will continue to do more.”
However, given that the median gross monthly starting salary of graduates in full-time permanent employment was $$1,800 in 2021, and for Higher Nitec (Engineering) was $1,500 in 1999. This means that the increase is only 0.8% per annum in the last 22 years or so.
As inflation was 1.5% in the last 22 years or so (CPI 1999 73.445, 2021 Jun 101.9) – does it mean that the real increase was only a negative -0.7% per annum (1.5 – 0.8%)?
