Originally posted by oxford mushroom:
An excerpt from an ILO report:
[b]Wage growth lags behind productivity gains:
In China labour productivity in manufacturing rose by 170 per cent
between 1990 and 1999, while real wages rose by slightly less than
80 per cent. Pakistan and India experienced a decline in real
manufacturing wages since 1990 a drop of 8.5 per cent in the
former and of 22 per cent in the latter. Indias wage decline
occurred despite an increase in manufacturing labour productivity
of over 84 per cent over the same period, indicating deterioration
in workers livelihoods despite the increasing efficiency of their
labour;
Long working hours: Large productivity gains
arent translating into substantially shorter working hours. The
top six economies in the world in terms of annual hours worked are
all AsianBangladesh, Hong Kong (China), Malaysia, Republic of
Korea , Sri Lanka, Thailandand a large share of people work 50
hours or more a week;
(http://www.ilo.org/public/english/region/asro/bangkok/public/releases/yr2006/pr06_16.htm)
Why the government cannot allow our wages to rise? Here's one
reason.
We live in Asia, arguably the most competitive environment in the
world. We used to rely on increased productivity to justify higher
wages (a PRC worker is cheaper but he makes plastic toys, our
workers make wafer chips).
That is still true to some extent but the technology gap is closing
very fast. PRC workers still make sports shoes and bras, but they
are also making disk drives and computer chips. As this ILO report
illustrates, their productivity is increasing extremely rapidly
(170%) whilst their wages have risen only 80%. And it is not only
the Chinese that are doing that, others are also increasing
productivity rapidly...'Thailand saw its labour productivity growth
soar between 1980-97, with the value added per person employed
rising by a whopping 141 percentage points' (Source:
http://www.hartford-hwp.com/archives/26/077.html).
Despite the rapid rise in productivity, catching up with newly
industralized nations like Singapore, the wages of PRC workers have
not risen as much and they work just as long, if not longer hours.
The ILO report specifically mentioned our close neighbours Malaysia
and Thailand as examples where a large share of people work 50
hours or more a week (more than six 8-hour-working days a
week).
In contrast, in Singapore, 'real wage increase exceeded
productivity growth in 2005 after three consecutive years
(2002-2004) of lagging behind productivity growth.' (
http://www.mom.gov.sg/ProceduresAndGuidelines/LabourRelations/LabourRelationsGuidelines/National+Wages+Council+Wage+Guidelines+for+July+2006+to+June+2007.htm)
It was only in 2005 that productivity exceeded wage increase. In
other words, whilst PRC and others have been increasing
productivity dramatically without giving their workers more rest
hours or high pay, we have paid our workers too much relative to
the gains in productivity. That anomaly has been corrected in part
with the variable bonus and other schemes. However, there is a
constant risk that whilst the government tries to keep our wage
rise slower than the rise in productivity, wages constantly and
significantly lag behind productivity gains in economies like the
PRC.
Of course this is not fair for workers, who work harder, upgrade
their skills but still earn little. Frankly, employers don't care
if you have no time for your family or that you can hardly afford
to pay your mortgage and feed your wife and 2 kids. If Singaporeans
demand more pay and shorter working hours without a drastic
increase in productivity, they will simply move their businesses
elsewhere.
So we have to capitalize on what the PRCs cannot do, and
drastically increase productivity. There is no way we can make bras
quicker or cheaper to beat them in productivity, so we have to make
the most high-value products or provide the most high-value
services possible. That's why the nation is moving into precision
engineering, aerospace engineering, biomedical sciences etc.
Young people who want to have a decent life in the future must
observe the trends of the global economy and react quickly. We have
an advantage in industries like biomedical sciences because the
West does not trust PRC with such high-value but also high-risk
products. (It is one thing to make toys...if it is not well made,
you can send it back. With medicine, it is quite another
matter.)
But our advantage will not be for long...PRC will build up its
reputation with time and when they do catch up (which they will),
we must be ready to re-train ourselves for yet another high-value
industry.
That is just the facts of life. We can whine about it all we want,
but it will not change the facts. Our jobs will always be at risk
until Thai and Chinese workers earn more than we do for the same
level of productivity. Until that happens, for us to be ahead, we
have no choice but to far exceed them in productivity. Our workers
in low-value industries will continue to see their wages depressed
by cheap foreign workers. It's either low wages or no wages at all
if the business moves out to cheaper economies.
[/b]
M I hearing the wrong thg, U said PAP gov is stupid to let our
salary overtakes productivity ? then the ministers ought 2 b sacked
drawing million $ and do nothing!!!
May be u become minister loh,good luck!!!
