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22 minutes ago
Thursday, 3 September 2020
Minimum Income or Enhanced Workfare Payout??? (2)
Read? Discuss minimum-wage idea now, even if it's to be implemented later: Jamus Lim
Read? Minimum Income or Enhanced Workfare Payout???
Hmm ... Never come and jio Uncle8888 to join Focus group discussion on Minimum Wage or Progressive Workfare.
CW8888: This is obvious! Minimum wage will lead to higher costs. Who is willing to pay more when they can pay less?
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Mr Lim had mentioned the idea of a national minimum wage - one of several proposals that had been in the WP's election manifesto - in a broader speech about more compassionate policy-making.
Though the government has warned that a national minimum wage could mean higher costs and lost jobs, studies show that Singaporeans are prepared to pay more for essential services, and that a minimum wage is likely to have only a minimal impact on unemployment, said Mr Lim.
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Current Workfare scheme needs to be raised higher towards to the level of Minimum wage!
Minimum wage translating to higher costs are paid by consumers and also affecting those on minimum wage - it is LPPL effect!
But, Workfare are paid by tax payers and most likely those on workfare scheme are not tax payers themselves!
See the difference!
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Haha the elephant in the room is the quantum. Minimum wage can be set at $1000 and many bosses will be happy liao.
ReplyDeleteIn US, the national minimum wage is only $7.25 per hour, or $1,276 per month of full-time employment.
Individual state or city can set higher, but is usually those more profitable & productive areas where companies don't mind going to.
$33 per week unemployment welfare.
ReplyDeleteEven in western countries, more & more what you get in benefits depends on how much you had contributed into the system.
No free lunch liao. :P
$33/wk i.e. $5 per day. Cham!
DeleteRead? Tharman challenges WP Jamus Lim’s views on minimum wage
ReplyDeleteWalau! Nobody in the Parliament debating on Minimum wage mentioned about Workfare!
Workfare is considered NOT part of the worker's wage or it is part of social welfare for lower income group?
Scratching head.
I Cannot Qualify If I:
ReplyDeleteLive in a property with an annual value of more than $13,000 (assessed as at 31 December of the preceding year);
Own two or more properties; or
If married:
Me and my spouse together own two or more properties; or
the assessable income of my spouse for the preceding Year of Assessment exceeds $70,000
The minimum wage has lofty goals of helping the poor. Whether the minimum wage is really beneficial to the poor is debatable.
ReplyDeleteIf the minimum wage is set too high, it will create unemployment to people who are worth less than the minimum wage. No employer (unless he is your father) will pay a worker more than what he thinks the worker is worth. Anything more will be charity. It is not fair to expect charity from bosses because they set up companies to make money, not give away money. A minimum wage which is set too high will lead to higher unemployment among the young, the old and the unskilled. The young will be hit because they still have not accumulated enough work experience to be worth more than the minimum wage. The old will be hit because their market value has depreciated below the minimum wage over the years. The unskilled obviously do not have the skills to be worth the minimum wage. They will be condemned to permanent unemployment because they will not be employed in the first place. Not being employed denies them the opportunities to acquire useful skills on the job which can lead to higher salaries. At least exploitation gives the low-wage worker hopes of gaining useful skills which allows him to command a higher salary later. By protecting workers against exploitation with minimum wage, more potential damage is done. It is exploitation that allows low-paid workers to have on-the-job training opportunities that hopefully will raise their worth later on. They can job-hop to higher-paying jobs after getting enough experience, thanks to exploitation. I think if people recall their job history, some probably felt exploited during their younger days with low salary. But it was this exploitation that allowed them to job-hop to higher-paying jobs later on. Surely, temporary exploitation is better than permanent unemployment.
The most seriously hit will be the poor because they are the group with the most number of people whose market value falls below minimum wage. Instead of helping the poor, the minimum wage may end up raising unemployment among the poor.
If the minimum wage is set too low, one might as well not have this rule in the first place. Why create unnecessary administrative cost and inconvenience?
Even if the minimum wage is set optimally initially, it will not stay optimal for long. The optimum level will be fluctuating with economic conditions. It is impossible for government officers to adjust the minimum wage optimally with changing economic conditions. If they can be so in tune with the economy, they might as well speculate in the financial markets and make a bundle.
Because it is so hard to set the optimum minimum wage, I think we should leave wages to be set by the invisible hand of the free market than the well-intentioned but clumsy hand of bureaucrats.
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I wrote my thoughts above about minimum wage 10 years ago.
Very well written!
Delete10 yrs ago and still debating till now. This time is lively debate with Professor with all theories. Can we show compassion or appreciation to lower income service delivery workers by tipping them? :-)
If S'pore ever adopt Min Wage, it will likely be based on "low hanging fruit" LOL.
ReplyDeleteE.g. At 10th percentile of resident wage earners.
Btw I can't find the stats for decile breakdowns of Singapore salaries. Usually MOM only report the percentage gains for the different levels, and the usual median salary.
I can only find the 20th % salary in a footnote ... $2,167 excluding employer CPF. I'm guessing the 10th % will be about $1,400.
2019 Labour Force Survey. (Page 33)
Singstat does report the household income per household member. But that's obviously not quite the same, as household member can include non-working children or elderly parents etc.
Household income as of 2019. (Page 7)
10th % = $597 per household member
20th % = $1,179 per household member
30th % = $1,647 per household member
These will be the numbers that any Min Wage discussion will take into account.
And in fact all existing wage support schemes like workfare, progressive wage model, special employment credit, wage credits etc are all targeting at pushing individual salaries to the $1.5K to $2K mark.
This is targeted at so-called low-margin or low-entry-barrier jobs/industries where free market will result in workers having very little or nil bargaining power.
For higher productivity i.e. greater profitability jobs/industries, free market will result in workers not offering their services below a certain salary range.