Slow Wage Growth in Singapore – What Must We Do to Survive?
In case you haven’t heard the bad news, slow wage growth in Singapore is expected to continue. In a city where prices shoot up higher than the blood pressure level of someone who eats at McDonald’s every day, this is an emergency. Keep your head down and continue working hard for The Man and you could soon see your nest egg sinking with the rest of the ship. Here are some tips to help you cope, just in case this sorry state of affairs does indeed persist.
1. Seek active growth in your career
It’s no longer enough to just try to be the best worker you can be and hope that your merits will be recognised. That’s a surefire way to put yourself on the road to becoming part of the nouveau poor.
See your career more as a strategy game than some straight and narrow Pilgrim’s Progress-type path. If you’ve been plugging away but still aren’t happy with your salary, you need to come up with a new career strategy.
If you’ve been loyal to a company that’s been consistently paying you peanuts, strategically job-hopping every 2-3 years might be the key to not starving. On the other hand, your slow progress might be due to a lack of qualifications, in which case you might want to consider going back to school, doing a part-time course or upgrading your skills.
For some of you, seeking active growth in your career might mean abandoning a dead end up job or a sunset industry altogether. It’s a difficult decision to make, but sadly many people such as security guards and F&B workers are experiencing falling real wages—meaning even if inflation were zero, they would still end up making less in a few years’ time, which is pretty insane.
2. Rethink the big purchases you’re thinking of someday making
Most people think they’ll be able to afford more stuff the longer they stay in the workforce. But if inflation outpaces wage growth, the opposite is true. That means that instead of moving closer towards being able to afford your dream purchases, you’re moving farther away.
The price of a car in Singapore exceeds that of a house in some countries. Taking cabs everywhere you go is even cheaper than buying a car here. Despite the fact that purchasing a car here seems like an astronomical financial burden, most Singaporeans still aspire to own cars—and shiny, new, un-embarrassing ones, at that.
Based on the way workers are being stretched more and more these days, instead of aspiring to one day be able to afford cars and private property, it might be more appropriate to instead downgrade your desires as time goes by.
For instance, when I was a kid I used to just assume I’d be able to buy my own place when I grew up, but now as an adult I’ve come to terms with the fact that there’s probably no way I’ll ever be able to buy property, at least not in Singapore.
3. Increase your target savings amount, even if it kills you
When you first entered the workforce, you may have pledged to save 20% of your salary. But the Singapore of 10 years ago is very different from the Singapore of today, and even as salaries get eroded by inflation, it is becoming more and more crucial to save.
But how the hell do you save when you are, in effect, earning less and less money each year? Desperate situations call for desperate measures.
To be fair, there are some pretty frugal Singaporeans out there. But because most (not all, though) Singaporeans have a roof over their heads and cheap hawker food, a lot of people are saving a lot less than they should since they can get by without doing so.
If you’re going to adapt to the changing face of Singapore, it’s time to start spending a lot less, even if it kills you. This means the Great Singapore Sale is now off limits, and it might also be time to pull Junior out of some of his tuition classes.
How do you plan to deal with stagnant wage growth and rising inflation? Let us know in the comments!