Manpower Minister Gan Kim Yong says wage increases must come
with increased productivity.
And he adds that the National Wages Council, which makes the annual
wage recommendations in May is also mindful of this.
He was addressing comments made at a tripartism forum
today.
The forum heard concerns about productivity putting pressure on
wage costs.
Chairman of the Singapore Business Federation, Tony Chew, says when
workers go for training to help them increase their productivity,
companies face manpower shortage.
At the same time there are work disruptions and operational
delays.
And trained workers would demand higher wages.
These he said are the realities.
Responding, Manpower Minister Gan Kim Yong, stressed that increase
in wages must be accompanied by improvements in
productivity.
"If we keep on increasing wages without actual improvement in
productivity, we will lose our cost competitiveness and it will not
be sustainable in the long term. So we need to watch wages, wage
costs, at the same time watch the productivity improvements. Both
of them have to be in line."
Chief Executive of the Singapore International Chamber of Commerce
Philip Overmyer, pointed out that even though companies want to
keep wages affordable, it's important to share productivity gains
with workers :
"In the process of improving productivity, the company sees higher
output because of the improved productivity and most good companies
recognise that you have to share the amount of benefits that goes
to the company and the benefits that goes to the employee who of
course have developed better skills."
However, gains from such productivity improvements may not
necessarily lead to higher wages.
But it could come in the form of a productivity bonus.
Secretary-General of NTUC Lim Swee Say cited the example of SIA
Engineering.
"Phase one of the operation, they saved $10 million. Now the next
question is what happens to this savings. So the union and
management came to an agreement that 24 to 33 per cent of the
savings will be shared with the workers in the form of a quarterly
productivity bonus and their target is to save $50 million a
year by the end of this year. If they can achieve that then the
quarterly productivity bonus for the workers could be as much as
$1,000 per quarter."
The tripartite partners also agree that management has to take the
lead in enhancing productivity.
Managers too need to attend training, to improve work
processes.
-- 938Live