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Coffeeshop Chit Chat - FT is a form of narcotic to Singapore...</TD><TD id=msgunetc noWrap align=right> </TD></TR></TBODY></TABLE><TABLE class=msgtable cellSpacing=0 cellPadding=0 width="96%"><TBODY><TR><TD class=msg vAlign=top><TABLE border=0 cellSpacing=0 cellPadding=0 width="100%"><TBODY><TR class=msghead><TD class=msgbfr1 width="1%"> </TD><TD><TABLE border=0 cellSpacing=0 cellPadding=0><TBODY><TR class=msghead vAlign=top><TD class=msgF width="1%" noWrap align=right>From: </TD><TD class=msgFname width="68%" noWrap>kojakbt89 <NOBR></NOBR> </TD><TD class=msgDate width="30%" noWrap align=right>Jan-15 8:40 am </TD></TR><TR class=msghead><TD class=msgT height=20 width="1%" noWrap align=right>To: </TD><TD class=msgTname width="68%" noWrap>ALL <NOBR></NOBR></TD><TD class=msgNum noWrap align=right> (1 of 6) </TD></TR></TBODY></TABLE></TD></TR><TR><TD class=msgleft rowSpan=4 width="1%"> </TD><TD class=wintiny noWrap align=right>43364.1 </TD></TR><TR><TD height=8></TD></TR><TR><TD class=msgtxt>Jan 15, 2011
MINIMUM WAGE
Beware the narcotic of nimble foreign labour strategy
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THERE has been much debate in Parliament on whether to impose minimum wage ('Minimum wage, maximum attention'; Thursday).
The argument that appears to have won the day is that a minimum wage is not viable as it will lead to job losses as firms cannot keep up with high labour costs.
The justification for hiring foreign workers is in having fluid numbers of foreign workers who can plug the labour crunch in times of growth; and who can just as easily be unplugged during downturns.
That is supposed to keep our labour market nimble. But this tells only half the story.
It is true that the ability to hire and fire at will, and having foreign workers as a buffer against domestic unemployment, have helped keep the economy nimble, mitigating wage inflation in times of growth and reducing domestic unemployment during recessions.
What is equally true and worrying is that this flexible labour market also allows firms to regularly postpone investing in capital - equipment, training, skills - that would otherwise help boost our productivity.
In times of high growth, the choice between making productivity-boosting investments and hiring more workers is a no-brainer.
But if foreign labour is freely and cheaply available from abroad, why would a company invest in training or equipment, both of which are costly?
Wage and labour issues are closely related to productivity, and foreign labour and free-moving wages are the narcotic our economy has preferred to longer-term solutions such as productivity increases through capital investment.
Firms, especially small and medium-sized enterprises, must watch their bottom line in the short to medium term for survival. Our current system encourages them to continue doing so, and to ignore longer-term needs in productivity increases.
Unless the taxes and levies on foreign workers are appropriately adjusted, subsidies and incentives to entice companies to invest in productivity gains will not take hold.
The Government must start taking a holistic approach to labour, wages and productivity gains, and not treat them as separate issues.
Tan Jiaqi
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MINIMUM WAGE
Beware the narcotic of nimble foreign labour strategy
<!-- by line --><!-- end by line -->
<!-- end left side bar --><!-- story content : start -->
THERE has been much debate in Parliament on whether to impose minimum wage ('Minimum wage, maximum attention'; Thursday).
The argument that appears to have won the day is that a minimum wage is not viable as it will lead to job losses as firms cannot keep up with high labour costs.
The justification for hiring foreign workers is in having fluid numbers of foreign workers who can plug the labour crunch in times of growth; and who can just as easily be unplugged during downturns.
That is supposed to keep our labour market nimble. But this tells only half the story.
It is true that the ability to hire and fire at will, and having foreign workers as a buffer against domestic unemployment, have helped keep the economy nimble, mitigating wage inflation in times of growth and reducing domestic unemployment during recessions.
What is equally true and worrying is that this flexible labour market also allows firms to regularly postpone investing in capital - equipment, training, skills - that would otherwise help boost our productivity.
In times of high growth, the choice between making productivity-boosting investments and hiring more workers is a no-brainer.
But if foreign labour is freely and cheaply available from abroad, why would a company invest in training or equipment, both of which are costly?
Wage and labour issues are closely related to productivity, and foreign labour and free-moving wages are the narcotic our economy has preferred to longer-term solutions such as productivity increases through capital investment.
Firms, especially small and medium-sized enterprises, must watch their bottom line in the short to medium term for survival. Our current system encourages them to continue doing so, and to ignore longer-term needs in productivity increases.
Unless the taxes and levies on foreign workers are appropriately adjusted, subsidies and incentives to entice companies to invest in productivity gains will not take hold.
The Government must start taking a holistic approach to labour, wages and productivity gains, and not treat them as separate issues.
Tan Jiaqi
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