January 14, 2010
A recent editorial published by the respected
international newspaper Wall Street Journal claimed that the
relentless influx of foreign workers in Singapore has helped to
depress the wages of ordinary Singapore workers leading to a lower
quality of life. (read article
here)
Due to the ruling party’s myopic immigration policies, the
number of foreigners has increased to 36 per cent of
Singapore’s population, up from 14 per cent in 1990.
“Between 2005 and 2009, Singapore’s population surged by
roughly 150,000 people a year to 5 million—among the fastest rates
ever there—with 75% or more of the increase coming from
foreigners,” Wall Street Journal reports.
The influx of cheap foreign labor helps to keep GDP growth
impressive since they help to cut business costs and create new
demands for good and services in the short run.
A significant proportion of Singapore ministers’ exorbitant
salaries is pegged to Singapore’s annual growth rates – the higher
the growth, the more money they bring home.
Prime Minister Lee Hsien Loong earns an estimated $3 million
dollars a year, more than 6 times the annual salary of U.S.
President Barack Obama. Even a Singapore minister earns
more than the most powerful man in the world and Singapore has a
land mass of only 0.000073 per cent of the United States.
Wall Street Journal estimates that “a third or more of
Singapore’s 6.8% average annual growth from 2003 to 2008 came from
the expansion of its labor force, primarily expatriates, allowing
Singapore to post growth more commonly associated with poor
developing nations.”
However their arrival has depressed the wages of blue-collar
workers, exacerbating Singapore’s income gap between the rich and
the poor. Singapore has the highest income-gap among the 30 most
developed countries in the world as measured by the Gini
Coefficent, comparable to some third world nations like Kenya,
Russia and Tunisia.
A long-term devastating effect of the mass immigration is that
it appears to contribute directly to the decrease in labor
productivity as companies continue to depend on cheap imported
labor to keep their profit margins instead of innovating to make
their businesses more efficient:
[Source: Wall Street Journal]
“Labor productivity, or output per employee, fell 7.8% in
2008 and 0.8% in 207—a phenomenon that could eventually translate
into lower standards of living,” said WSJ.
In an interview with Mr Kenneth Jeyaretnam, an economist
by training and the Secretary-General of the Reform Party, he
opined that immigration has “kept our economic growth high but, at
a tremendous cost.”
Another economist, Choy Keen Meng from NTU added that “relying
on foreign labor to help boost growth is unsustainable” and that a
“better model would involve the reining in immigration and
accepting that Singapore is becoming a more mature economy like the
U.S. or Europe, with a long-term growth rate of 3% to 5% a
year.”
But then, a decreased growth rate will hurt the pockets of
Singapore ministers who have been justifying their astronomical
salaries on the grounds that they have “delivered” economic growth
to Singapore when GDP figures can be easily popped up artificially
by increasing the intake of foreigners without translating directly
to a higher quality of life to its citizens.
Though Singapore is able to lose billions of dollars of national
reserves from investment losses suffered by its two gigantic
sovereign wealth funds GIC and Temasek Holdings, Singaporeans
receive few social welfare benefits from the ruling party which has
won 11 consecutive elections by overwhelming margins since first
assuming power in 1959.
Wall Street Journal recounts the plight of 58 year old
Singaporean Lee Ah Lee who makes 850 Singapore dollars a month
(about US$600) clearing tables in a cafeteria, saying that the
flood of immigrants has made it hard to make ends meet by pushing
down blue-collar pay in Singapore.
Despite rising unhappiness and resentment among Singaporeans at
its pro-foreigner policy, the ruling party is adamant that the
influx of foreigners will continue to increase Singapore’s
population eventually to 6.5 million people.
At the rate the ruling party is replacing native Singaporeans by
their new pets from China, India, Vietnam, Malaysia, Indonesia,
Myanmar, Bangladesh and even Nigeria, many Singaporeans may end up
like Lee Ah Lee in their twilight years, finding themselves
replaced by “foreign talents” and have no choice but to continue
working till they drop dead and die to finance the hefty
housing loans of their over-priced HDB flats built by the ruling
party.
KNN
PUI