SBR recently featured a post on the May Day rally, found the original link here:
NTUC May Day Rally 2013 Afterthoughts Part 1 | AspirantSG
So if companies don't buck up to be CBF and grow the economy, my pay won't increase?
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However, one slide that caught my attention was the one which described Real Wage Increase from 2009 to 2011. Apparently, Singaporeans enjoyed the highest real wage increases based on core Consumer Price Index (CPI) compared to countries like Korea, Japan and Norway. While it is great to know that Singaporeans enjoyed comparatively good income growth during this period, my concern would be about our real wage performance for 2012 and beyond. Will Singaporeans still be able to enjoy real wage growth despite facing competition from cheaper foreign talent and rising inflation levels?
To put things into a larger perspective, Prime Minister Lee explained (in the next speech), that the Singapore economy is moving into a new phase and the nation is not expanding as rapidly as it used to. Given that our economy is maturing, Singapore's shift to slower growth is inevitable. If Singapore’s economy grows at a slower pace so will the growth of our wages.
Mr Lim Swee Say explained how our economy is transitioning from a "3 + 1 = 4" to a "1 + 2 = 3" economy.
As Singapore is reducing reliance on foreign labour, causing workforce growth to fall from 3% to 1%,
the challenge is for Singapore to increase productivity growth from 1% to 2%,
in order for the Singapore economy to reach a slightly compromised GDP growth from 4% to 3%.
As there is strong competition for global investments and markets, if Singapore is unable to produce competitive goods or services, demand for our goods and services will decrease, causing GDP growth to slow down, unemployment to go up, and wages to stagnate. Without better jobs and better pay, it will be difficult for us to enjoy better standards of living.
Even if demand for our products and services increase, the next challenge would be whether our country can produce fast enough to supply this demand as we are also in the process of reducing the inflow of foreign labour. If we cannot supply fast enough, our market share will decrease, causing GDP growth to still slow down, unemployment to go up, and wages to stagnate.
So what makes a successful Singapore economy?
According to Mr Lim Swee Say, it is being competitive (in goods and services to increase demand), being productive (for companies to increase supply to meet demand), and translating this rise in supply and demand into better jobs, better pay and better work life balance for workers.
Enhancing Competitiveness By Becoming A Cheaper, Better, Faster (CBF) Economy
The first ‘how’ to achieving this success is where Mr Lim Swee Say's Cheaper, Better, Faster Economy Concept comes into play. Not to be mistaken as lower remunerations for workers, these 3 terms are actually solutions for businesses to be more competitive. He elaborated further that to be cheaper means to be more productive, to be better means to be more capable, to be faster means to be more adaptable.
Singapore must learn to make smarter use of technology, innovation, capital and know-how to be more “future ready” than our competition. China, for example, is investing huge amounts of research and development into technology to enhance the productivity of their workers.
To give some credit, the Singapore Economic Development Board (
EDB) is aggressively attracting investments to create better jobs for Singaporeans. Prime Minister Lee mentioned that Rolls-Royce and Pratt & Whitney have invested in our Seletar Aerospace Park, while Procter & Gamble is building a Singapore Innovation Centre to develop consumer products for the Asian market.
EDB has also set aside a $500m fund over the next five years into the development of future manufacturing technologies to help SMEs grow, both at home and overseas.
But if we don’t play our part and keep up with the rest of the world, we only have ourselves to blame for falling behind.