More companies will raise low—income workers’ wages: ASME

SINGAPORE: President of the Association of Small and Medium Enterprises (ASME), Chan Chong Beng believes there is no need to put in place a minimum wage.

He said more companies will raise wages of low—income workers within the next two years.

Mr Chan felt the progressive wage model, championed by the labour movement, will be effective in helping to raise wages.

Under the progressive wage concept, wages will be gradually scaled up as workers become more skilled and productive.

Mr Chan was responding to Professor Lim Chong Yah’s call for a minimum wage scheme, should the wages of the lowest—paid resident workers remain stubbornly low in two or three years’ time.

Prof Lim, who is the former chairman of the National Wages Council (NWC), made the suggestion at the Singapore Economic Policy Forum on Thursday.

Mr Chan also said low—wage workers are generally mobile and will move to a company that can pay them more.

Mr Chan said: "Workers are very fluid; they will move around and if the industry cannot pay workers the minimum (wage) of S$1000, they will go to another industry that has (a minimum wage of) S$1000."

Similarly, NTUC does not support the idea of having a minimum wage.

Director of NTUC’s Unit for Contract and Casual Workers, Zainal Sapari, said: "We are very concerned that minimum wage could actually lead to job loss among workers, especially those vulnerable workers."

The Singapore National Employers Federation is also against the idea.

Hong Kong, which introduced minimum wage in May 2011, saw its gini—coefficient rise to 53.7 in 2011, as compared to 53.3 in 2006 and 52.5 in 2001.

However, some Singaporeans whom MediaCorp spoke to welcomed the proposal.

Ms Angel Vaishilee, a corporate trainer, said: "Expenses keep going up all the time, and by having a minimum wage, there’s a security for Singaporeans to live here, with the fact that I’m able to pay for my bills, I’m able to pay even if I come from different backgrounds, any education as well."

"It’s just a starting point where it will spur them on, to want to acquire more skills and experience, for the company to give them a higher increase in salary progressively," said Mr Daniel Abraham Yee, a financial planner.

Stakeholders urged caution on the suggested three—year wage freeze for top earners.

Mr Mark Hall from Kelly Services said: "Singapore is all about driving innovative new industries and businesses, so controlling the salaries of those sectors will limit the opportunities or perceived opportunities of home—grown talent and also the investment of other organisations who want to enter Singapore. It will be quite difficult for them to enter a country which has a wage limit."

"Global talent commands global wages and remuneration," said Professor Augustine Tan, practice professor at SMU School of Economics. "If you ask me, it is a problem with global capitalism that has brought this about — where people who are very talented can command what we might consider obscene wages."

Stakeholders say all suggestions will have to be balanced for Singapore to remain competitive.

— CNA/xq