Tag Archives: Minimum Wage

Structural problems doom Progressive Wage Model to failure

I originally wrote the below article as an exclusive for The Online Citizen. I am reproducing it here with their permission.

Zoom2Launched and promoted to great fanfare by the ruling party, the progressive wage model looks good as a press release, but is hamstrung by the twin flaws of obviousness and impossibility. Obviousness, in the sense that it describes a relatively straightforward career progression ladder that employees should be encouraged to climb toward greater salaries – an idea that many would suggest does not require a million dollar minister to think up. But also the impossibility of the system is glaring, because there appears to be no way to actually require employers to give their staff the chance to climb this skills ladder. In fact, one look at an example “wage ladder” reveals another truth which should have been obvious – a company staffed with employees who have all reached the highest rung would be very “top-heavy” and probably unsustainable as a business.

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Why Singapore has no minimum wage

Why does Singapore not have a minimum wage? This may be a million dollar question, but it has a one hundred billion dollar answer.

Most developed countries have one – either in law or negotiated through unions. But oddly this is one feature of first world life that the PAP stubbornly refuses to even consider. It is something that many locals would like to see for many reasons. It would help to level the employment landscape which is currently tilted in favour of cheaper foreign workers who can more easily support a family in their lower cost of living home country. A minimum wage would also encourage employers to work towards more productive economic growth rather than pumping up the wealth of the nation by importing cheap labour inputs of increasingly marginal economic benefit in ever greater numbers.

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