When interviewed by media about the state of economy, United Overseas Bank (UOB) economist Francis Tan said that Singapore’s productivity growth has been near zero since 2010.
“If you look at the economic growth of Singapore on a yearly basis, since 2011, the growth rate has been smaller and smaller… the average productivity growth from 2010 to 2014 was near zero.”
Singapore productivity growth for the 6 years between 2009 and 2015 is only a measly 2.7%. The influx of cheap foreign labour in 2009 depressed wages and productivity as Singapore employers prefer to hire more labour than put money into labour-saving technologies like machines and software. In the construction sector, a Bangladesh general worker cost only around S$600 in monthly wages and another S$160 for government levies. This is still cheaper than the average salaries of unskilled Singaporean workers which is at S$1,000 (cleaners and security guards).
In 2010, Prime Minister Lee Hsien Loong started telling businesses to grow productivity. However 6 years later today, the prostate cancer patient still failed to get it up. In 2015, Manpower Minister Lim Swee Say simplified the country’s GDP system and equate GDP to productivity and manpower. Minister Lim stuttered his explanation and reiterated the need for productivity growth as the primary driver for GDP.
The Singapore government will be announcing its Budget for FY2017 this Thursday (Mar 24) and business lobbyists have submitted their wishes, ranging from tax cuts to more government grants, to the ruling party PAP via MPs with vested business interests. Nee Soon PAP MP Lee Bee Wah is a director of a construction company that take up HDB projects in her constituency. More government grants, tax cuts and reduction of foreign workers’ levies will directly benefit MP Lee Bee Wah’s company and indirectly into her own pockets.
Tax companies like Ernst & Young and KPMG are calling for the government to lower income taxes for the rich, while property developers are lobbying to remove the property cooling measures by claiming that the property sector is crashing. Singapore Business Federation is telling the government not to raise the Minimum Wage, and hoping that the government loosen the immigration floodgate so businesses can continue to enjoy the influx of cheap foreign labour.