Tuesday, September 07, 2010

Prof Hui : Evidence for link between foreign labour influx and depressed wages is compelling....

"A growing influx of low-skilled, low-cost foreign labour has effectively increased Singapore’s overall labour supply. There is an ongoing debate as to whether this has depressed domestic wages at the bottom. I believe the available evidence for this link between the influx of foreign labour and depressed wages at the bottom is compelling."
- Professor Hui Weng Tat, LKY School of Public Policy,
Straits Times Article : Minimum Wage Law Works[Link]
.
I personally believe the foreign influx is also the main cause of structural unemployment among older Singaporeans age 45 and above. While many Singaporeans experienced first hand the negative effects of the PAP govt's very extreme foreign labor policy - importing foreign labor at one of the highest if not the highest rate per capita in the world - through housing and transport, the real economic pain is experienced by the bottom 20% of the population that saw their wages depressed as the cost of living rose. ...and the PAP is responsible for this through its lopsided and unbalanced policies.

38 comments:

Clear eyed said...

To the PAP everyone here, aside from their fellow "elites" and cronies, are just digits, not human beings. As digits we exist only for the purpose of generating wealth and more wealth for them. Being digits and not human beings, we have no rights to freedom, happiness, health, dreams and all the other things that make living worthwhile. I believe this explains how the "elites" can go about enjoying their lives of uberluxury without the slightest pang of conscience at the pain of those not in their class. Or perhaps, having been ensconced in their uberluxury for so long, they no longer have any conscience left in them.

We have to vote for a change of system here. It will be a tragedy if we allow ourselves to continue to be ruled by mercenaries of such ilk.

Anonymous said...

If u are good, u should help us to find a decent job, but not just use people's money to build somethings that look nice to show-off.

Anonymous said...

PAPies also work on 80:20 rule. As long as 80% of voters are making do with life can already. Even if many of these 80% are struggling with day-to-day living, come to the GE, 66.6% will still vote for PAPies.

PAPies are counting on these 80% to be KS about their property price. They will say to the people, "See? I just change a few regulations and the property demand drop liao. You vote in opposition, don't know what policies they come up with, and all your property will become slums and worthless liao!"

As for the 20% --- they are insignificant to the PAPies, worse than animals in Mandai Zoo. Becoz animals in Mandai Zoo bring in tourist dollars and increase GDP. While the remaining 20% are just liabilities to the PAPies.

Towkay said...

35 years old, not 45 is considered overaged.

My buddy's factory even more cleverer - cut off age for new hires is 30. He has to recruit new staff directly from Malaysia cos' too many oldies in Singapore.

But not to worry folks, we hire 100% locals, which according to MOM's definition is citizen + PR.

Towkays are actively replacing our aging workforce with young foreigners. But don't worry, we will convert them to PR aka locals. Nothing illegal here.

Anonymous said...

I believe that ntg will derail the foreign labour gravy train from its inexorable trundling passage mapped out by the PAP leadership, judging from even the most recent "moderating" statements coming from them.

It may make some detours, slow down somewhat, even make a few stops enroute accompanied by loud announcements but it will still eventually and soon enough get us to 6.5m level and maybe beyond.

The only way to completely slow the train to a permanent crawl is within our means.

Anonymous said...

consoling factor is that foreigners bring good rental dollars to supplement those with inadequate income. A substantial number(the bottom 20%), with room to spare, have been compensated that way?

don't undermine the value of your hdb:)

papapapapap lol

Anonymous said...

I strongly encourage you guys to set-up your own business to hire locals since you are so against foreign workers. Don't just look to the government to hire the oldies. We have big problem getting locals to work for us. Have to wake up at 5.30am so that we can leave at 6am to Tuas, otherwise traffic jam. Have to work OT till 9 or 10pm before going home. How many locals want this type of life ?

Anonymous said...

Things are not so simple. Can you tell me any business besides government businesses that has no competition?

There are many local SMEs out there trying to survive. If you do not hire FT, how to compete with others? LSS already said that if the local SMEs cannot compete, then shipped out of Singapore.

Fret not, local SMEs will be replaced by F SMEs soon, though they should be PRs within a short time. Then they will recruit more FTs, their networks will become larger and whatever the local towkays left must be either very enterprising or have very good connections...

Anonymous said...

I have already known that Luxembourg has the highest per capita in world, however I did not know that they have a coalition government and a population of just half a million (according to Wiki)...

Anonymous said...

Seriously, who gives a shit to the bottom 20% if the GDP growth = more performance bonus for all civil servants and ministers....

Anonymous said...

The elections will be held within 1 to 1.5 years time, and yet the PAP is still adamant about importing hordes of foreign PMETs to directly compete with Singaporeans for jobs.

Imagine what will happen if we give PAP another 5 year mandate?

How many Singaporeans will still have jobs?

Anonymous said...

"Have to wake up at 5.30am so that we can leave at 6am to Tuas, otherwise traffic jam. Have to work OT till 9 or 10pm before going home. How many locals want this type of life ? Anon 17:00"

You have this sort of life because PAP encourages exploitation of labour. Why not ask the towkay himself to work at such hours for the same pay?

The bastard will gladly cut our pay so that he can buy himself a bigger car, but will lie to us that if we don't accept lower pay and work very long hours, his company cannot survive.

Anonymous said...

In countries like Japan or Australia or UK, people doing blue collar work like truck driver, carptentor or brick-layer can expect to earn a decent pay.

In Singapore, if you are blue collared, u will be lucky to be pay $1500, and this pay is expected to shrink further with the influx of foreign labour.

Most developed countries pay you a mininum wage whereby you can live comfortably and have the motivation to work well. In Singapore, nobody gives a shit whether your pay is enough to survive, but they expect the moon from you. Nobody gives a shit if your pay is too low, but you are constantly encouraged to sacrifice yourself for the "greater good". Sadly, the "greater good" will glady tell you to fvck off if it improves the bottom-line, especially if they can do so by importing FTs.

The US is facing the same problem, where they refuse to pay fruit-pickers and farm workers a decent wage, and they wonder why so few Americans are willing to do the job. In the end, hordes of FTs from Mexico come in, where a shit pay in US is considered high pay back home in Mexico.

At the end of the day, FT or citizen, people want to be paid a decent wage and have reasonable working hours. But that seems to be an unreasonable request for most management, who have "no money" to pay decent wages, but have money to spend golfing, buying second car, upgrading condo, supporting a mistress or boozing.

Towkay said...

7/9/10 19:07

That's why we need a constant supply of young FTs. I am grateful to the PAP for understanding the need of businesses.

You see, when we work our workers 16 hours a day, 6 days a week they burn out fast. Every 5 years or so, we import new foreigners to replace the burnt out foreigners. The burnt out FTs can return home with their wealth and live a leisurely life.

Anonymous said...

capitalism not communism is the buzz word here...

Anonymous said...

You guys complain for what? Save for a few, I bet most of you who had the chance to vote voted for the PAP in the last election and the ones before that. Oh yes and all your usual excuses of "opposition not good enough" "not my ward" "my property prices will go down" blah blah blah. So really you all deserve to get screwed by the PAP.

Anonymous said...

as if opposition won't screw us. hehe.
since will kena screw anyway, might as well get use to pap " soft touches" lol

Anonymous said...

I am a graduate in my fifties, presently, I am working as a production operator getting less than $1,200 per month.

When I saw those young Indians, Myanmar and Mainland Chinese who are doing executive jobs, jobs which myself and many displaced singaporean, in the forties, fifties, can do, I asked myself, what has become of this country?

Anonymous said...

I never understood why voters refuse to vote for opposition, citing the usual "no track record" reason.

Seriously, what track record can the current PAP boast of? Any credible track record of PAP was done decades ago, and has absolutely no relation to the current PAP leaders.

Here is PAP's current track record:

1. Many Singaporeans losing their jobs to FT, due to overly liberal FT policy

2. Many Singaporeans seeing their incomes depressed, due to overly liberal FT policy

3. PAP refusing to acknowledge this problem up till today, forever citing cheap labour and FTs doing jobs that Singaporeans don't want.
PAP unaware or ignorant that FTs are now directly competing with Singaporeans for skilled jobs in engineering, finance, PMETs, IT, transport, executive, HR, sales, positions?

4. Housing prices rocketing upwards while incomes are shrinking


5. Mas Selamat escape

6. YOG flop, YOG bursting of budget, poor food and welfare for Singaporean volunteers

7. Multiple flooding and lack of decisive action.

8. MRT overcrowding and PAP just shrugging their shoulders


9. Means testing in hospitals. Most of us are now paying more for hospital bills. Wow!

10. NS for citizens, scholarships for foreigners. Have you seen the thousands of foreign students in NUS, NTU, SMU on Singapore-sponsored scholarships, while the majority of Singaporean students either pay their own fees, or have to resort to bank loans?

Truly NS for citizens, scholarships and good jobs for foreigners

11. Cheapening of Singapore citizenship.

It is too easy to qualify for PR status in Singapore, where PRs enjoy 95% of the benefits of citizens, to the point that most citizens realize it is better to give up citizenship for PR-ship if possible.

PR has practically all the perks of citizenship, minus NS liability.

Why do you think PAP suddenly wants to give $9000 to pacify the growing number of angry young Singaporean voters who have just finished NS and can vote in the coming elections?

That is PAP's track record for the past few years. Vote wisely.

Anonymous said...

Dear Mr Lucky

PAP has an army of so called grass roots leaders.
They know the ground better than you do.
And obviously they know that they are depressing the wages of the vulnerable.
They are even doing a bukkake on old soldiers (see Mr Brown).

Because they know that they have already won the next election.

What part of that do you not understand?

Your pet squirrel boy is advising Singapore's brightest not to come home. He is probably right. But what does that mean for the weak here who cannot escape?
Learn to swallow?

Anonymous said...

To anon at 20:46:

Did you vote for the pap in the past? If no, you have my sympathy. If yes, too bad for you.

Anonymous said...

From : "Unemployment resulting from changes in the basic composition of the economy. These changes simultaneously open new positions for trained workers."

Foreign influx maybe a reason for structural unemployment but it is not the main one. The main cause is the composition of the economy has changed and ALL (Policy maker + people) are unprepared for it.

Anonymous said...

//
Foreign influx maybe a reason for structural unemployment but it is not the main one. The main cause is the composition of the economy has changed and ALL (Policy maker + people) are unprepared for it.
//

Singapore is a planned economy!!!

Anonymous said...

"""How many locals want this type of life ?""""

So u mean locals do not deserve to live a decent life here, not to mention swiss std of living.

So u mean locals do not deserve to live in spore??? (if they cld not find a job locally, how are they going to survive here)??

What u want them to do then??? Whose resp is this????

Anonymous said...

""The burnt out FTs can return home with their wealth and live a leisurely life.""

The burnt out FTs can return home and become a millionaire in their own countries.
For the younger locals, they may hv to suffer amother 30-40 years.
Is that the life u want yr children to look forward to??

Anonymous said...

They will find your assertion of depressed wages to "lack perspective".

You see, "perspectivified", wages here are too high, given that wages in other places are much lower. Hence, if you're able to see things in perspective, wages are not being depressed - rather they are being brought to equilibrium in the global market for labour.

However, when it comes to costs of living, one needs to change one's perspective to compare with loftier 1st world counterparts. Prices of HDB flats much increase in the name of asset enhancement.

There was a taxi driver who once commented that "everything is as they say it is". That's the way it is, and that way has led to the demise of many a great ancient civilisation. Not a happy ending.

Towkay said...

7/9/10 22:45

How come people keep mentioning about my children's future when I talk about replacing Singaporeans with FTs? Very funny.

You don't have to worry about my children's future or those of my PAP and Towkay buddies. Our children's future are well taken care of.

Anonymous said...

"""I am a graduate in my fifties, presently, I am working as a production operator getting less than $1,200 per month.""""

This is a good proof that FTs are creating jobs for the locals.
If the FTs are not here working as "Executives", u think the empoyers would want to (or cld) employ u as an operator?? So that u can hv yr "workfare"?
So be grateful!!!

Anonymous said...

//
Foreign influx maybe a reason for structural unemployment but it is not the main one. The main cause is the composition of the economy has changed and ALL (Policy maker + people) are unprepared for it.
//

++Singapore is a planned economy!!!++

Competitions from other countries are fast and furious. We can plan but what is the vision ?

Anonymous said...

@Anonymous 7/9/10 20:46
I am a graduate in my fifties, presently, I am working as a production operator getting less than $1,200 per month.

You for real or not? I can believe that 50+ grad become factory worker --- nowadays even 35+ grad cannot find executive jobs. But I find it hard to believe pay is $1.2K. Basic pay yes, but you shld have some extra OT, meal allowance, shift allowance etc to make it at least $1.5K.

Otherwise you may as well find some senang security guard job to do --- pay at least $1.4K and no need to meet production quota etc. My distant relative even purposely find security openings in industrial estates becoz less "govt", don't need deal with public, don't need to be so polite, can relak more etc. He even go for night shift, coz after 11pm it's lights out, the the place all locked up. Can sleep until at least 5+am.

Once a while, some Towkay SME will close shop in the area. Then everybody leh-long and grab whatever equipment & supplies left behind to sell to wholesalers.

Once in blue moon I stand-in for my relative if he's sick or just want to rest. Why not? $50 for just 4 hrs of doing nothing, the rest of the time sleeping, watching portable TV, or trading forex on my netbook.

I come from blue-collar family background so I know the typical factory jobs and security jobs. If can keng, just grab the money and keng.

Anonymous said...

The following are quoted from Page 3 Prime Section of The Straits Times reported on Thursday, 29 November 2007.

Note:
Local includes Singaporean and Permanent Resident
In reality, if a company employs local, the company has a tendency to employ only permanent residents.



THE STRAITS TIMES THURSDAY, NOVEMBER 29 2007
Page 3 PRIME
"==================================
Doors open wider for foreign workers

Rules on quotas eased to allow more hiring at all levels, especially S-pass holders

Companies hungry for workers cheered ...

They are a very welcome, very timely and very significant response ...

BRING MORE FOREIGN WORKERS IN

All sectors
-----------
Increasing S Pass
Jan 1 '08: 25% of company's total workforce

Enhanced Personalised Employment pass (PEP) Scheme from March 1 '08:
PEPs are granted to individuals based on their own merits, and are not tied to specific employers.
Foreign professionals whose last drawn fixed monthly salary overseas was at least $7000 will be eligible for a PEP.

Construction and Process sectors
--------------------------------
Jan 1'08: 1 local worker to 7 foreign workers
Mar 1'08: 2-year work experience needed to be exempted from Man-Year Entitlement quota

Marine sector
-------------
Jan 1 '08: 1 local full-time worker to 5 foreign workers

Manufacturing sector
--------------------
Jan 1'08: Up to 6.5 out of every 10 workers in a company can be foreign

Services sector
---------------
Jan 1' 08: Up to 5 out of every 10 workers in a company can be foreign

=================================="

Anonymous said...

I do not think security guards are paid 1.4k, maybe unless you are talking about 12 hours shift security jobs.

To put things into perspective, the newspaper ran an article about SBS increasing the pay of bus captains from 1100 to 1300 excluding overtime and other allowances.

Though there may be security jobs paying 1.4k, I think the average pay is probably less than 1.2k. Anyway, I think it does not take a professor to tell you that pay in Singapore is depressed and increasingly, it is affecting

Anonymous said...

@Anon 02:27

"Services sector
---------------
Jan 1' 08: Up to 5 out of every 10 workers in a company can be foreign"

Scratch my head becos' what I see in all malls and factories etc., most cleaners are foreigners with a Supervisor who may be local. I do not believe many Singaporeans can accept such low pay and thousands are Malaysians that commute everyday from Johor. Companies like ISS and Initial for example employ lots of them. Impossible that they can employ 500 locals/PR's and have 1000 cleaners, right?

Anonymous said...

Let me tell you my story. I worked for an MNC and handles regional markets. There were recent job openings available (no less than 5) which I was perfectly qualified for the role.
Went for interviews with 3 firms, but guess what? The candidates that were picked in the end?
Taiwanese, Malaysian (from KL), Indian.
They denied me, a true blue Singaporean a chance to move up (or at least get a better paying position).
Just for your information, for those who are unaware, Taiwanese are paid worse than us but only because their cost of living is lower.
I have Korean colleagues who lives in Singapore that said that Singapore is so much more expensive than Korea, and he always wonder how Singaporeans actually can cope and worse, with retirement.
So continuous denial is no use. Prima facie evidence is enough proof why Singaporeans are getting short changed by the government policies. Exercise your vote carefully.

Anonymous said...

First, there are too many foreign maids. If we half the number of foreign maids, there will be many jobs available for Singapore. In Switzerland, wages are high and few people have maids. Part-times cleaners are available at $80/hr. This the standard that we should aim for, except that many Singaporeans are not likely to welcome a higher cost of goods and services in Singapore.

Anonymous said...

If we are all being paid Swiss wages with Swiss minimum wage and Swiss standard of workers' rights, then I don't mind paying paying part-time housekeepers to come in 1-a-week for $80/hr.

It's the freaking wage gap between average salary and cost of living in Singapore that's the problem. Plus the bigger problem of not being able to find adequate paying job if you're 35+ and jobless.

In the old days, if there is high local citizen unemployment, cost of living and prices will drop because low demand. Until an equilibrium point reached where Singaporeans can accept low pay jobs because is sufficient for living, and employers are able to pay low wages to take on more workers.

Today, with both legs open wide-wide policy, the cost of living is artificially being propped up and even increased due to indiscriminate influx of foreigners. At the same time, foreigners bring with them low wages and young age which employers naturally like. Hence local citizens are doubly fvcked --- no jobs or depressed wages AND high cost of living.

Alpha male said...

Wonderful article,thanks for putting this together! "This is obviously one great post. Thanks for the valuable information and insights you have so provided here. Keep it up!"

Anonymous said...

Remove the wool from your eyes people! This policy is not only affecting the salary levels of the bottom 20%. I hold a senior head of function position in a reputable MNC and the salary of my counterpart in Hong Kong is double of mine, considering that the jobs are at the same level within our company's wage structure and also that the costs of living are comparable, that's a whopping 50% hidden income tax that I've been paying as a result of the govt's policy. And on top of that I still need to pay the official income tax as well.

Perhaps Lucky should do an analysis and write a piece on how this is affecting all levels so that even the well to do can wake up and the nation can be galvanised for change.