Progress report: Inside Singapore’s fight to lift wages at the bottom

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Note that Singapore does not adopt a blanket/universal minimum wage but uses the Progressive Wage Model (PWM) instead, which sets a minimum wage for targeted sectors (those who low wages), with provisions for the workers in these sectors to rise to enjoy higher wages which are pegged to their skill levels. This incentivizes the workers to upgrade their skills and make the model sustainable for employers, with the understanding that the increased skills of workers will lead to higher productivity and more profit for the employers, who can then pay the higher wages for these more skilled workers.

The PWM is first and foremost a wage floor...It mandates a minimum wage for workers in certain sectors and occupations. It also establishes career pathways where salaries rise as workers meet stipulated training requirements. The aim is to uplift wages for Singaporeans and permanent residents whose incomes are in the bottom 20 per cent

It was quite odd that very highly trained personnel… were coming out of ITE (Institute of Technical Education) or polytechnic, and they were paid about $1,000-plus. “No one's going to join your sector in the long term if you continue like this; What's the point of being highly trained and skilled and the salaries are very low?”

criticised the PWM for having “so many additional conditions that the incentives for upskilling turn into loopholes employers use to retain workers on the lowest rung of wages

For its part, the Government is co-funding wage increases at each PWM rung from 2022 to 2026 under the Progressive Wage Credit Scheme to help soften the impact on companies.

There were concerns that a minimum wage could be seen as a maximum wage and form a cap on what employers would pay. Or no wage, because no employer would employ someone if their productivity wasn’t commensurate with income

Qn: How realistic is it for countries to implement a national minimum wage for all their workers? (Cam. 2023)