Real wages may drop 2.7 per cent this year

[Animian]

ASIAONE / BUSINESS / NEWS / STORY

 

Monday, Jul 23, 2012

my paper

 

Real wages may drop 2.7 per cent this year

 

Ms Chan Shu Jun has her eye on a new camera, but her rising monthly expenditure is making her think twice about buying it.

 

The 25-year-old analyst in the financial sector estimates that she spends about half of her monthly income - in the region of $4,000 - on food, shopping and entertainment.

 

Although her wages have increased by about 7 per cent in recent years, Ms Chan is still concerned by inflation and the spectre of shrinking incomes here.

 

She said: "I'm exploring investment opportunities to offset inflation. There's no point saving money in banks as the interest rates they offer cannot keep up with inflation."

 

Her concerns are shared by many, with real incomes likely to fall by 2.7 per cent this year, according to a survey by the Singapore Human Resources Institute (SHRI) and wage consultancy Remuneration Data Specialists.

 

This is despite an expected increase of 1.5 per cent in nominal wages. The survey - which was conducted last month and covered 167 companies across key sectors, like services and construction - shows that further wage stagnation is expected next year.

 

Although nominal wages are expected to increase by 3.1 per cent next year, that will be offset by an expected 3 per cent inflation rate.

 

The former chief economist for the Government of Singapore Investment Corp, Mr Yeoh Lam Keong said that Singapore faces both "wage stagnation" and "inflationary problems".

 

"Wage stagnation appears to be a general trend globally but, in Singapore, this is exacerbated by the massive influx of low-wage workers, which depresses nominal wages," he said.

 

SHRI executive director David Ang said he is especially concerned with the ability of low-wage workers to manage their daily expenses on transport and food. Any increases would eat into their disposable incomes, he explained.

 

Mr Yeoh said that these expenses make up a big proportion of low-wage workers' "consumption baskets", thus an income drop will hurt their pockets.

 

He suggests that the Government raise the Workfare Income Supplement Scheme payout significantly by "about two to three times, and allocate a bigger share of the payout in cash rather than in the form of CPF".

 

This will help push low-wage workers past the poverty line, rather than "wait for productivity levels to increase to push real wages up". He said: "That would take too long."

 

The survey also found that about eight in 10 companies are expected to hire new staff this year. This is projected to drop to fewer than six in 10 firms next year.

 

Mr Yeoh believes that the sluggish United States economy, euro-zone crisis and China's faltering growth may dampen business sentiments here.

 

"This could then cause a lack of business confidence to hire," he said.

 

 

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she spent 4K on food etc and that is half of her income and she worry how about those earning MUCH less than her..

 

sometime i wonder how the press work ... they either feature the extreme high or extreme low income group ... not realistic at all

[Hondacub777]

When they say income increase,pple say how come mine never increase!

Now the wages drop,most pple here won't feel the pain.MCF pple are too rich to realize the 2.7% lah

[Wyfitms]

Not bad. 25 yr old earning 8k already. Some might say that she's a high flyer. 25 yr old i was still in sch.

 

probably bulk of the 4k was on shopping. Unless she goes to hotel for buffet everyday.

[13177]

Not bad. 25 yr old earning 8k already. Some might say that she's a high flyer. 25 yr old i was still in sch.

 

probably bulk of the 4k was on shopping. Unless she goes to hotel for buffet everyday.

Some people even 35 year old maybe only earn half or less than that!

[Jman888]

the petrol price up few cents every other week already more than that....

 

 

[Animian]

Some people even 35 year old maybe only earn half or less than that!

 

 

yah lor... i almost 40 also not even close to her 8K :(

 

that's why i say what is wrong with the press...

 

they either make me feel interior by having this high flyers article or they make me feel super fortunate by having those low income article ... emotion roller coaster

[Wintersonata]

Not bad. 25 yr old earning 8k already. Some might say that she's a high flyer. 25 yr old i was still in sch.

 

probably bulk of the 4k was on shopping. Unless she goes to hotel for buffet everyday.

 

Half of take-home is $4k, means she is earning way more than $8k.

$1k goes to CPF, so at least $9k salary, then it's possible.

Edited July 23, 2012 by Wintersonata

[Kangadrool]

Financial Analyst so good pay? Somemore she's 25 only.

 

People at senior management post only start to draw this kind of pay. Middle mgr and line mgr also cannot smell 8K/month. Jin hoh tan...

 

How come other companies pay their staff so well one? I frog in the well?

Edited July 23, 2012 by Kangadrool

[Old-driver]

I read it this way... half of her monthly income - in the region of $4k and half of it goes to expenditure

[Alpha78]

I read it this way... half of her monthly income - in the region of $4k and half of it goes to expenditure

 

Some of these editors need to be shot for being ambiguous. By that statement, half her expenses = $4000, or half of her income WHICH IS in the region of $4000, which is which?

[Animian]

the way i read is half of her monthly which is in the region of $4K

if she earn $4K ...shld it be spend half of her $4K monthly income

 

anyway i F9 my angmo so i can be wrong

[Kangadrool]

I read it this way... half of her monthly income - in the region of $4k and half of it goes to expenditure

 

Woah, this is like primary school maths now - use trickery england to teach maths.

[Jamesc]

So she earn 8k or 4k?

 

If she earn 8k, is she single?

 

[Old-driver]

Woah, this is like primary school maths now - use trickery england to teach maths.

ha... english is tricky... so perhaps is half of 4k.

[Jamesc]

The writer ang moh is sibei terok

 

[Singhao]

Analyst in a bank is a very junior role. It's probably $4k monthly pay. Relax guys haha...

[Mercs]

Inflation and costs are up but wages coming down...

[Timbuktu]

Why you all get so worked up?

The sentence structure could have been clearer, if it were better punctuated.

Her pay is $4K and half of it goes to yada yada ...

 

But even if it is $6-8K for a graduate female (no NS) having worked 4-5 years, depending on her degree and calibre, that is no surprise!

 

BTW, in my company, the starting pay now for fresh grads (non medical, or legal) with good professional Honors degrees ... 1st or 2nd Upp Divs, is $4K.

 

Nothing to pull your hairs out and shout like you guys just did!

Just goes to show that many are you are prolly underpaid.

 

Pls see my other posts on Singaporeans who have slipped into the low-middle income group (sandwiched class) over the last 5-10 years, without realizing it until now ... when they find cars and property difficult to reach.

It's not you, but the high networth FTs at the (new) top of our socioeconomic and GenY high flyers who have relegated you.

Edited July 23, 2012 by Timbuktu