Minimum Wage Misperceptions Need Correcting

The Singapore Democratic Party notes and welcomes the recent discussion around minimum wage. However, there are several misperceptions that need to be cleared up as they act as resistance to the adoption of a minimum wage in Singapore.

Some common misperceptions to minimum wage are, “Minimum wage does not affect me, as I earn above the minimum wage”; “Will my salary be cut if my current salary is above the minimum wage”; “Minimum wage is not fair to those who work hard, as you can get minimum wage without working hard” or “Even if you set minimum wage at $10,000 it will still not be enough for some”.

A minimum wage is needed to provide for an adequate living standard. It is also an instrument to prevent employers from exploiting workers. More importantly, it signals to the values we as a society want to adhere to ensure workers, other than ourselves, are adequately compensated for dignified living. Hence, entrenched beliefs and attitudes towards a minimum wage is part of the challenge of implementation.

Many countries have a national minimum wage, and they review and adjust their minimum wage annually, depending on the cost of living. Singapore is one of the few remaining exceptions.  

Since the late 1990s, SDP has been calling for minimum wage to be implemented. In 2001, in our election campaign booklet, we called for a minimum age of $5 an hour and a retrenchment insurance. We continued to track and monitor the issue and in 2010 we proposed a revised minimum wage of $6.80 hourly rate. In 2015, we proposed a $7 hourly rate which works out to be $1232 per month for a full-time job of 44 hours per week.

In our most recent review undertaken by SDP’s Policy Team in October 2020, our proposal is a minimum wage of $10 an hour, which would work out to be $1,760 a month, based on a 44-hours work week. This would commensurate with the amount required for an older person to achieve a basic standard of living in Singapore at S$1,721. We explain the details in SDP’s update of its Party Minimum Wage Policy (watch this space).

Without correcting these misperceptions, proposing any figure for minimum wage, even with brilliant rationale, would create a misunderstanding over what is minimum wage and its purpose.

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