Several people have argued that a minimum wage will increase the cost of living further. This is true, but the impact will not be as large as feared.
Wages is only a part of the total cost of business operations. The other costs are rental, government levies and profit margin. Many workers now earn more than the minimum wage, so the increase in wage cost will only apply to the workers who now earn less than the minimum wage. This increase will not be significant for most businesses, except those that depend on low income workers.
Even if the wage cost increases, the price charged to consumers may not increase to the same extent. Businesses have to meet competitive pressures. If they are squeezed, they will have to pay lower rental on their business premises and reduced profit margin. The increase in wages will be partly offset by the reduction in these other costs.
In countries with a minimum wage, the property prices are at a more reasonable level (in relation to average earnings) compared to countries with wide disparity of income.
A minimum wage policy reduces the disparity of incomes and will lead to a more fair and stable society, which will lead to better long term growth.
Tan Kin Lian
Sunday, February 14, 2010
Speaker's Corner - Singaporeans vs Foreigners
ALEX TAN'S TALK IS TODAY, AT 5 PM, AT SPEAKERS CORNER
Hi Mr Tan Kin Lian
I will be conducting a speech on the topic "Singaporeans" at the Speaker's Corner on the 2nd day of Chinese New Year.
Date and Time: 15 February 2010 5 pm
http://www.facebook.com/inbox/?ref=mb#/group.php?gid=153492722129&ref=ts
Your support would be highly honored and appreciated.
Yours sincerely
Alex Tan
Minimum wage and cost of a maid
Some people argued for a minimum wage to be implemented in Singapore. REX argued against it, stating that the cost of a maid would increase to $1,500 a month, if a minimum wage is applied here.
I do not think that a minimum wage need to be as high as suggested by REX. It could be set at $1,000. If we consider the wages, government levy, food and lodging provided to a maid, most employers are already paying close to $1,000 a month.
If we pay a higher wage for a maid, we will get a better quality maid, which may be better in the long run. There is also a high cost in replacing a maid. Under the current system, many employers have to replace the maid quite often and suffer this additional cost.
We should not allow the higher cost of employing a maid affect our thinking towards paying a decent wage to other workers in Singapore who need to earn enough to pay for the high cost of living in Singapore.
I do not think that a minimum wage need to be as high as suggested by REX. It could be set at $1,000. If we consider the wages, government levy, food and lodging provided to a maid, most employers are already paying close to $1,000 a month.
If we pay a higher wage for a maid, we will get a better quality maid, which may be better in the long run. There is also a high cost in replacing a maid. Under the current system, many employers have to replace the maid quite often and suffer this additional cost.
We should not allow the higher cost of employing a maid affect our thinking towards paying a decent wage to other workers in Singapore who need to earn enough to pay for the high cost of living in Singapore.
Saturday, February 13, 2010
Welfare in Singapore
Read the views in the Singapore Mind blog, and also the article by Economist magazine.
A nice name for big gambling
When you place your chips on a specific color (i.e. red or black) in a roulette game at a casino, you are gambling. The bigger the stake, the bigger is the gamble. You can gamble all of the money that you have in one bet. If you win, you win big. If you lose, you lose all.
Gambling is considered to be bad, especially if the bet is big and a loss may lead to financial ruin.
In recent years, banks have been gambling big, very big, to the tune of billions of dollars. They can bet on currency rates or on the chance of failures of any corporation. The types of bets have proliferated under the name of financial engineering and innovation. In some cases, they can gamble large amounts representing the capital of their shareholders and the deposits of their customers as well.
When the banks make these gambles, they do not call it a gamble. They call it by more respectable names, such as "trading:" or "risk management".
Gambling is bad, if the stakes are high and may cause financial ruin. It is bad for individuals. It is bad for businesses. It is bad for banks.
Tan Kin Lian
Gambling is considered to be bad, especially if the bet is big and a loss may lead to financial ruin.
In recent years, banks have been gambling big, very big, to the tune of billions of dollars. They can bet on currency rates or on the chance of failures of any corporation. The types of bets have proliferated under the name of financial engineering and innovation. In some cases, they can gamble large amounts representing the capital of their shareholders and the deposits of their customers as well.
When the banks make these gambles, they do not call it a gamble. They call it by more respectable names, such as "trading:" or "risk management".
Gambling is bad, if the stakes are high and may cause financial ruin. It is bad for individuals. It is bad for businesses. It is bad for banks.
Tan Kin Lian
Friday, February 12, 2010
Most Livable Cities - Surveys
Here are some surveys of the most livable cities around the world. Singapore missed the top 10 but is not too bad (e.g. ranked 18 in the Monocle Survey).
In the Mercer survey, Singapore ranked 34th based on 39 factors including political, economic, environmental, personal safety, health, education, transportation and other public service factors. Cities were compared to New York City which was given a base score of 100.
In the Mercer survey, Singapore ranked 34th based on 39 factors including political, economic, environmental, personal safety, health, education, transportation and other public service factors. Cities were compared to New York City which was given a base score of 100.
Vancouver is rated the world's most liveable city
I visited Vancouver last year and found it to be a nice city to live in. It has been rated the most liveable city in this report. Seven of the top 10 cities are in Canada and Australia. I hope that Singapore can learn from the lessons to improve the quality of life here.
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