Raise for Singapore’s Low Wage Workers: But What’s Missing?


Ryan Ong



Singapore’s low wage workers are getting a boost from the government. For the first time since 1984, the National Wages Council (NWC) is recommending a minimum quantum of pay raise. But they’re fighting a lonely battle; when it comes to low wage workers, assistance means more than a simple pay raise. Here’s my take on what’s missing from our aid attempts:

What’s the Raise Like?

It’s $50, plus an unspecified percentage. And this for workers who earn under $1000 a month.

No offence and all, but that’s about as helpful as a pair of blunt scissors. I guarantee a whole bunch of companies are already reading “unspecified percentage” as “nothing”.

$50 is not “help for the low income” alright? $50 is the bribe an underage teen pays the bouncer at Zirca. And unless that “unspecified percentage” turns out to be pretty damn high (like 30% at least), let’s say low wage workers haven’t got much to celebrate.


Singapore's lady construction workers
At MoneySmart, we couldn’t do these ladies’ jobs. We don’t want to chip our nails.


Besides, I’d argue the greatest obstacles facing low wage earners can’t be solved with a quick pay raise. We’re still missing some key components:

  • A Long Term Plan
  • Increased Employee Protection
  • Improved Health Plans
  • CPF Top-Up


1. A Long Term Plan

Considering they act every 28 years or so, the NWC should probably establish a longer term plan. Right now, their proposal consists of saying “Eh, give them at least $50, and that should fix it.”

This raise may provide limited, immediate relief. But we’re in a situation where inflation and a (second) global financial crisis are looming. This small raise may not be sufficient in three to five years; and while I don’t expect the NWC to have a crystal ball, I did expect a more comprehensive strategy.

I was thinking we’d see a plan that links wage increases (for the poor) to specifics like rising costs of housing or transport. Or even a cyclical scheme for wage raises.


Powerpoint that says "yes, no, maybe"
Okay, someone needs to look up “strategy” on Wikipedia.


We already know that HDB loans have a higher interest rate than the banks. We know SMRT is facing a $900 million facelift (potential far hike alert). We know that taxi fares are up, and that school tuition is becoming a necessity.

The NWC needs a strategy to deal with that: A wage plan that responds, or is pegged to, existing variables. In particular, that “unspecified percentage” should not be left open. It should be a specific figure. What about some milestones? 10% the first year, 15% the next two years, etc.


2. Increased Employee Protection

Foreign labour hits low wage workers first. Foreign workers may work for a pittance, but $3.50 an hour might make them the Bill Gates of their village. For Singaporeans, this place is home. And down here, $3.50 an hour makes you the poster-child for “Study Harder in School” campaigns.

Our low wage workers have nothing to sell but their labour. The majority are in jobs like construction, F&B, or cleaning. These are industries where it’s hard to justify their higher costs based on “work quality”.


Lining up for chicken rice
No lah, can’t be my cooking. The line is because of how my assistant ties the chilli bags.


What’s that? I hear companies disagreeing. Here’s a question that’ll shut them up: Will they pay more for a bilingual local worker? Or a local worker with WSQ upgrading?

Most of the time, the answer is no.

It doesn’t matter enough who screws on a nut, or rubber-bands a packet of chicken rice. Low wage workers are corralled into industries where the bottom line (in employment) is their wage. The cheaper worker wins the job. And that’s not the local.


3. Improved Health Plans

Have you seen the health benefits for low wage workers? Some would be lucky if their boss flipped them an expired Panadol.

Yes, I know that health insurance (beyond workman’s comp) is expensive. And I know a single company might not be able to afford premiums on all their workers. But what if a group of companies were to approach insurers?

Picture this: five or six cleaning companies, with a total pool of perhaps 150 cleaners. A single company lacks the clout to bargain; but if they can get together and offer to buy 150 new policies at once, I bet those premiums will drop. Either that, or they’ll get a better deal on coverage.


Clinic bar singapore
Actually, I don’t know if this is a real clinic. But the boss gets credit card points.


Here’s a comment from a Ms. Ng, who’s a cleaner at my place:

“I make $750 only, so if I have toothache, or stomach-ache, I also don’t want to see the doctor”.

Treatment is typically $50 – $80. If treatment could potentially wipe out more than 10% of your monthly income, you’d develop a high pain threshold too.

Low wage workers need to be shielded from medical costs. With little or no savings, a medical emergency forces the low wage earner to use credit. This creates debt and builds a poverty trap. And the ones who do set aside money for emergencies will lack the funds for self-upgrading.


4. CPF Top-Up

Have you ever been poor before? If you have, you’ll know how it messes with your spending habits. The moment you get money, the first impulse is to spend it before it’s gone. I’m willing to bet that’s where the raise money will go.

It’s not entirely their fault: When you’re making less than $1000 a month, you’ll be scrimping just to save, say, $200 a month. And at the end of the year, you’ll have amassed…a pathetic $2400. That’s about as appealing as close-up shots of a skin condition.


Guy with drink, next to santa claus hat
I’m not celebrating two years of savings. I’m spending it. See the drink?


Problem is, savings are vital for low wage workers. Remember: These workers can’t afford better growth schemes (even fixed deposits tend to require at least $5000). If they buy insurance, they’re in constant danger of lapsed payments. And their jobs’ pension schemes (should they exist) look like prize redemption catalogues at a petrol station.

I’d say that, issues of pay aside, low wage workers need an urgent, sizeable top-up to their CPF. In fact, better for them to not get immediate cash-in-hand, but better provision for their retirement.

Image Credits:
mikecogh, petrr, All in One Training, sarahgoldsmith, Michael Spencer, Hanumann,

What more can be done to help low wage workers? Comment and let us know!

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Ryan Ong

I was a freelance writer for over a decade, and covered topics from music to super-contagious foot diseases. I took this job because I believe financial news should be accessible and fun to read. Also, because the assignments don't involve shouting teenagers and debilitating plagues.