Monday 1 July 2013

Do S'porean workers deserve their wages?

By Han Fook Kwang, The Sunday Times, 30 Jun 2013

Do Singaporeans deserve the salaries they are paid?

That was the pointed question posed by a reader responding to a piece I wrote on how median wages had stagnated in recent years despite a growing economy (The Sunday Times, June 16).

He didn't think it was surprising because, to put it bluntly, that's what they deserve.

This was how he put it, which I'm quoting extensively because his perspective is worth airing even if it's painful to hear:

"Singapore's median income of $3,000 per month is fairly high if converted to local currencies of neighbouring countries such as Malaysia, the Philippines, India and China. Does the average Singaporean worker deserve this premium?

"Is he/she really more analytical, creative, articulate and productive than our Asian counterparts let alone those in the developed countries of Switzerland and Germany?

"My experience and that of many of my friends and colleagues who have tried recruiting Singaporeans in this income bracket does not bear this out.

"For a start, many local graduates... have a hard time conversing in good English... Because of this, they generally tend to be poor communicators and lack the confidence to interact in group situations.

"The other weak area is reasoning and critical thinking skills... Many Singaporeans looked great on paper but had great difficulty with case interviews where one needs to think on one's feet.

"The problem is further exacerbated by every local's dream to work in an office job in a nice central location. So, unlike in Australia or the US where people try to pursue their passion and maximise their inherent skills be it as a teacher, welder or nurse, here even someone who has trouble stringing together two sentences sees himself as a marketing manager in a multinational corporation (MNC).

"Singapore is not a developed country in the sense of Japan or Germany or Switzerland where the average worker is well-trained and of high quality...

"The German engineer is behind scores of world-class SMEs that populate various small towns across Germany. Ditto for Japan and Switzerland... The SME boss in Woodlands and Bukit Batok is not competing with SMEs in the US and Japan but with those in China and Vietnam.

"Singapore's high GDP is not because of high-quality local workers and companies but because of the more than 7,000 MNCs that use this as a hub to produce world- class products and services. This crucial difference needs to be kept in mind."

Ouch! That's how I felt, like having cold water splashed after being slapped hard in the face.

The truth hurts especially when it's conveyed by a foreigner who has had more than 10 years' experience working here and is now a citizen.

He isn't alone in making these points.

In the same week I received the e-mail, the head of a German MNC here also raised a similar concern, on the lack of drive of workers here compared with those of other countries. He has worked previously in his home country Germany, in China and now Singapore.

German workers, he said, had made a dramatic turnaround in the last decade, shedding the label they once wore as the sick man of Europe.

That was when they suffered many years of sluggish growth and the weight of a huge national debt incurred from unification with East Germany.

In his view, if there was a hunger index for workers, that of German and Chinese workers would be moving upwards - they were getting hungrier, with the Chinese shooting off the charts.

In contrast, he said, for Singapore workers, the chart was moving in the opposite direction.

In case you think only foreigners hold such views, a friend who owns and runs an SME business here is always complaining to me about how difficult it is to recruit Singaporeans and how disappointed he often is about their work attitude and skill level.

I have heard similar comments from other Singaporean bosses.

Their views cannot be dismissed in any discussion on what sort of wage increases Singaporeans can expect in the years ahead.

What has happened to the much vaunted quality of the local workforce which helped propel the economic transformation of the country?

The fact remains that if Singapore workers didn't possess the skill and ability required, the country wouldn't have made the leap from Third World to the thriving city it is today and attracted all those MNCs to invest their billions here.

If something has indeed changed, it is that the easy years are over.

When the Singapore economy grew from the 1960s to the 1980s, salaries rose rapidly for most workers because they were able to improve their skill levels year after year, from the low base they started at.

The competition then was with the likes of similarly emerging economies making the same kind of rapid progress - Hong Kong, Taiwan, South Korea and others.

Today, with the low-hanging fruits all but plucked, the going will be much slower and tougher.

To make the next leap up the income ladder, Singapore workers will have to be as good as those in Germany and Switzerland.

But as that reader asked, are they as analytical, creative, articulate and productive?

Just by way of comparison, Switzerland, with a population of eight million, boasts more than 20 Nobel Prize laureates and an impressive list of world-class companies such as Nestle, Swatch, Rolex and many others.

The average life span of a Swiss company is 125 years - they've managed to survive by constantly reinventing themselves to stay relevant, supported by a highly educated and skilled workforce.

There are clearly no quick fixes or easy solutions for Singapore.

It will require fundamental changes both in the economy and in the education and training of Singaporeans.

That's why those changes in the schools to make students less obsessed with doing well in exams and better at learning how to acquire skills and knowledge relevant in today's fast changing world are so important.

Learning how to learn, whatever the subject, possessing deep capabilities in the jobs you do, being able to communicate well, having a lively interest and pride in what you're doing - these are the attributes of a successful First World workforce.

If Singapore fails to make the transformation to this next stage of its development, it will have to live with stagnating wages as a fact of life.

* The great salary debate
The Sunday Times, 7 Jul 2013

In his commentary (“Do S’porean workers deserve their wages?”) last Sunday, managing editor Han Fook Kwang quoted a reader who wrote to him questioning the capabilities of Singaporean workers and if they deserved the wages they were paid. Some business owners – both local and foreign – feel the same way as they think workers here lack drive and skills, said Mr Han. And there are no quick fixes or easy solutions to this issue, which will require fundamental changes both in the economy and in the education and training of Singaporeans. The article elicited more than 20 responses, with some readers bemoaning Singaporean workers’ poor grasp of English, their attitude and lack of thinking skills. Others said the comparisons were unfair, and that workers here deserved to be paid more.
Here are some of the responses.

Defensive mindset must go

All concerned Singaporeans should read and re-read managing editor Han Fook Kwang's commentary.

Arising from the issue of our median income stagnating at $3,000 per month, the question is whether this reflects the true worth of Singaporean workers vis-a-vis others.

The unique circumstances in Singapore peg our median income at the current level. We count our blessings and thank our far-sighted leaders for the blissful state they have brought us, but we need not apologise for it.

However, the reader who responded to Mr Han's earlier commentary ("When wages fail to grow along with economy"; June 16) pointed out numerous hard truths about Singaporean workers.

Issues that cannot be ignored any longer include many local graduates' inability to converse in good English, lack of confidence to interact in group situations, poor reasoning and critical thinking skills, and a reluctance to venture abroad, as well as the fact that the average worker here is not as well trained as those in Japan and Germany.

I know these to be fair observations, having worked in two global companies in the past 32 years.

I agree with Mr Han that there are "no quick fixes or easy solutions" and "it will require fundamental changes both in the economy and in the education and training of Singaporeans".

However, I would go further to suggest that efforts should be made now to change the defensive mindset of many Singaporeans from an early age, both at home and in school.

By being humble and accepting that we have to learn to speak well, interact better, think harder, learn the job well and be adventurous in our career choices, we will be taking a giant step forward in turning us into a world-class workforce.

By defending the current system and practices on the basis of flattering rankings that we have received periodically, we will continue to sell ourselves short.

Not only will our median income stagnate, but so will our intellect and job skills relative to our neighbours' and competitors'.

Yeoh Teng Kwong

All have a part to play in increasing wages

There are three additional perspectives to consider.

First, the growth of our economy has benefited higher-income workers, given our focus on the financial, high-tech and pharmaceutical sectors.

Our gross domestic product (GDP) per capita increased by 67per cent, from $38,865 in 2002 to $65,048 last year. Within the same period, residents' gross median monthly income grew slower, by 46 per cent, from $2,380 to $3,480.

Income inequality remains high with our Gini coefficient at 0.45 to 0.48, and the top decile's resident household income is four times that of the middle decile. Therefore, we have to focus on growing industries that also generate good median wage jobs.

Second, the wage share of GDP in Singapore has averaged a low 40per cent for the past three decades, which is 10 to 15 per cent behind that of developed economies.

This difference is due to our reliance on multinational corporations (MNCs) and higher-output- oriented industries, and also our friendly business policies and sustained foreign labour inflow.

Business owners have obtained more value from our economic growth than workers. Therefore, our unions must continue to ensure that workers earn their fair share of the growing pie.

Third, even as MNC executives complain about the poor attitude and lack of skills of some Singaporean workers, we must remember that there are many other Singaporeans who diligently contribute to their businesses.

MNCs choose to be situated in Singapore because of our strong rule of law, competitive tax regime and attractive and safe environment. Singaporeans contribute to this safe, secure and stable society through national service and taxes.

The Government is right to consider how to ensure that employers give Singaporeans fair and just consideration for jobs.

We, as workers, must step up to grow median wages, but the Government, unions and business owners must also play a part to ensure that the increased efforts of Singaporean workers are justly rewarded.

Soon Sze Meng

Poor standard of English a problem

Managing editor Han Fook Kwang has aired a truth that political correctness and politeness have long buried.

I run a tiny legal practice and for a long time was shielded from the harsh realities of the labour market because I had an excellent legal secretary. Unfortunately, she relocated to Turkey with her husband.

Over the course of a year, I experimented with all types of hires, among them polytechnic graduates. They could not string one sentence together, let alone two. They could neither reason nor organise work flow. Some of them found it impossible to make it to work on time, or at all. And once trained, they jumped ship the moment they could.

I was, however, lucky enough to get an intern, a National University of Singapore business graduate, through family connections. Her attitude and aptitude were excellent, but she struggled with her English.

When I pointed out to her that her sentence lacked a verb, she had no clue what a verb was, or the rules of sentence construction.

At a class reunion, one of my former classmates, now a school principal, told me ruefully that Singapore had lost two generations in terms of English, as they were not taught the rules of grammar.

Our education system needs yet another revamp, and industry leaders need to be consulted.

Josephine Chong (Ms)

Not all jobs given equal respect

If you ask me whether Singaporean workers deserve a median monthly wage of $3,000, given the value of the work they put in, I would say "no". Our wages are being pushed up artificially, mostly by the seniority-based wage system and a predetermined pay structure depending on one's basic qualifications, experience and age.

A fresh graduate entering the workforce would expect to be promoted every two to three years, and be a manager within five years.

With so much prestige placed on managerial posts, many have missed out on the opportunity to master skills and become an expert in their respective fields.

Singapore's work culture does not accord equal status and respect to every job. Maybe this is impossible to achieve in a society where the segregation between the haves and have-nots is too great to be resolved.

Francis Seah

Workers deserve their pay - and more

It is unfair to look at Singapore's median income of $3,000 in isolation and jump to the conclusion that Singaporean workers do not deserve their wages.

Income and cost of living go hand in hand. While $3,000 would be deemed sufficient in Singapore, it would not be enough for someone living in cities like Tokyo, Osaka, Sydney, Oslo and Melbourne.

Being the sixth most expensive city in the world, Singapore should be compared with similarly ranked cities, and not low- cost cities like those in Malaysia, the Philippines, India and China.

Singaporean workers not only deserve their wages, but also need to be paid more.

It is wrong to compare a city-state with a country with many cities. Incomes of workers in the five most expensive cities are at least twice those of Singaporean workers, while their property and car prices are cheaper, and they have comprehensive social welfare systems.

The presence of 7,000 multinational corporations and foreign talent contributes considerably to our gross domestic product, but without the collective efforts of the critical mass of Singaporean workers, we could never have achieved good growth.

Singapore may not excel in many fields, but it has become one of the world's largest oil rig builders, and our oil refineries, airport, waterworks and powerhouses are manned by local engineers and technicians.

Singapore will slowly but surely learn to reach the next stage.

Paul Chan Poh Hoi

Can't compare apples and oranges

I struggle to agree with the view that "Singapore's median income of $3,000 per month is fairly high". The reader who wrote to managing editor Han Fook Kwang has failed to appreciate a few points.

First, comparing the median income of Singaporeans to that of Malaysians is like comparing apples and oranges.

Salary is not always linked to productivity, but also to socio-economic factors like the cost of living.

The hourly wage of a fast-food-chain waiter in Malaysia is $3, compared with $5 in Singapore. Given that the productivity of both workers is the same, does it mean that the Singapore worker is overpaid?

I would not think so because there are differences in the cost of living in the two countries. In Singapore, the average fast-food meal costs $8, compared with $4 in Malaysia.

Accordingly, there is a difference in the amount of money they earn for their companies - and they should be appropriately compensated for that.

Second, the reader considers workers in Japan, Germany and Switzerland more well-trained, articulate, creative and productive than their Singaporean counterparts.

Having lived overseas for a fair number of years, I do not share his opinion.

Like their Swiss and German counterparts, our workers fall into different parts of a spectrum, ranging from those who are poorly motivated to those who enjoy their work, are productive and employ creativity in the course of their work.

However, I agree that there is room for us to improve in our national productivity, and this can be done through empowering junior staff to make level-appropriate decisions, education, efficient staff deployment, outsourcing, infrastructure investment and reducing the excessive reliance on foreign labour.

Christopher Liu

It's a 'marketing' problem

It is sad to read the critical comments from a foreigner-turned-Singapore citizen quoted by managing editor Han Fook Kwang. The reader must have forgotten that without a quality Singaporean workforce, he wouldn't be as successful.

The problem lies in our education system or "factory", which is designed for the sole purpose of churning out efficient and obedient workers to support our economy.

I have been working in a multinational corporation since the start of my career. One thing that differentiates foreign talent from locals is that the former know how to promote and market themselves well.

In contrast, Singaporeans just get the job done without vocally claiming credit during meetings and presentations.

It is the Facebook age now, we cannot afford not to flaunt our achievements. We need to make sure that we get as many "likes" as possible in real life.

Derek Low

Onus on workers to show hunger
By Janice Heng, The Sunday Times, 7 Jul 2013

One strand of public unhappiness over foreign labour policy has been the idea that some bosses simply prefer foreign professionals, managers and executives (PMEs) to Singaporean ones. The Government is moving to tackle this. But what happens if Singaporeans aren't good enough to win a fair fight?

Plans to make firms give Singaporeans a fair chance were mentioned in this year's Budget debate, and came up again at an Our Singapore Conversation session last weekend. The Government also plans to raise the threshold for Employment Pass salaries, to ensure that local and foreign PMEs compete on quality rather than price.

A commentary by managing editor Han Fook Kwang last Sunday, however, noted that firms might prefer foreigners as workers here might lack hunger and skills. This is not to argue against the upcoming measures. Firms should have to make unbiased assessments of Singaporean candidates.

But if firms give Singaporeans a fair chance yet still find them lacking - what then?

Any government is arguably obliged to ensure good job opportunities for citizens. But as Acting Manpower Minister Tan Chuan-Jin has pointed out, this should not mean jeopardising economic openness and dynamism.

Balancing citizen aspirations and economic openness is possible only to an extent. If and when a perceived excess of foreigners can no longer be explained by hiring bias, Singapore will face a choice.

It can adopt some form of "affirmative action" for Singaporeans. Or it can accept that Singaporeans have had their chance, and the best person should get the job.

The first option may compromise quality, endanger foreign investment and breed complacency. The second leaves citizens in the lurch. Of course, the dilemma would be averted if Singaporean PMEs turn out just as capable as their foreign counterparts. Whether or not this is currently the case, our best bet is to try and make it so.

There is much the Government can do: from upgrading and training, to reforming education to encourage critical thinking, initiative, and other skills prized by employers.

But when it comes to hunger, the onus is on workers. The hunger for a job should not just create demands to be spoonfed. It should spur self-improvement, hard work and the willingness to broaden one's diet - for many worthy jobs are not office-bound.

If we do end up facing that dilemma, perhaps tough love is in order. After all, the unemployment rate in Germany and China - whose citizens were said to be hungrier - is around twice that of Singapore's. Tougher conditions might make for tougher Singaporean PMEs.

How long that will take is an open question. We might have to wait for a new generation to grow up in conditions where having a job is no longer taken for granted.

But change can also happen one worker at a time.

When, say, a student on exchange realises that his peers in Europe are worrying about finding any job at all. Or when a job seeker looks at his foreign counterpart, with better qualifications or a willingness to work harder, and feels not bitterness, but the urge to out-compete.

Yes, governments are obliged to provide job opportunities. But the job itself is something to be fought for.


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