SINGAPORE: Like other developed economies, Singapore has a slow domestic sector where workers earn less, as well as a bigger and more outward-focused sector where workers tend to earn more.
Calling this a “two-speed economy”, Deputy Prime Minister Tharman Shanmugaratnam said the challenge is to ensure that a large part of the economy does not get stuck on low gear, because then overall wages will see little growth.
Mr Tharman, who is also the Coordinating Minister for Economic and Social Policies, made those comments in an interview with NTUC This Week, a weekly publication by the labour movement. The transcript was released on Saturday (May 13), when he was conferred the National Trades Union Congress’ (NTUC) highest honour at its May Day Awards 2017.
Mr Tharman said Singapore’s basic economic challenge is to sustain income growth for the average worker, and for lower-income workers.
To do that, he said Singapore has to “deepen our skills, spur innovation in every industry, and move beyond what is currently a two-speed economy.”
He acknowledged that it’s not possible to get every industry to run at the same speed, but for companies who want to transform industries, “bold, disruptive changes” are needed.
DISRUPTION AND THE “FOSBURY FLOP”
To explain his point, Mr Tharman used the story of the Fosbury Flop, a high jump technique pioneered by Dick Fosbury at the 1968 Mexico City Olympics.
He ran in curving loop towards the bar before leaping backwards, head first, with his legs coming over last, breaking the Olympic record by 6cm.
“By the mid-70s, every serious international jumper was doing the Flop,” said Mr Tharman. The Olympic record went up by 15cm in the next 30 years, with further refinements to the technique.
American Dick Fosbury clears the bar in his new, unorthodox style to win the high jump gold medal at the athletics event of the Mexico 1968 Olympic Games on Oct 21, 1968 in Mexico City. The “Fosbury Flop” was quickly adopted by other jumpers to become the standard style. (Photo: EPU / AFP)
“So the Fosbury Flop is a story of a sudden leap that disrupted the game, making old techniques redundant, and everyone then copying and improving it and taking the record even higher,” he added. “That’s how it must be in the economy, and especially in the industries that have been stuck in low gear. We have to allow and encourage disruptive change. There is clearly scope for it.”
He cited the example of the retail industry where e-commerce is a game-changer, and in the urban logistics and construction industries.
“If we can achieve this – both the bold, disruptive changes and the constant improvements that are part of an innovative economy – we can keep growing wages for the majority of Singaporeans,” he added.
ROLE OF COMPANIES IN LIFELONG LEARNING
However, with disruption, people doing traditional jobs can be put out of work. “So we have to help them get into new and good jobs as quickly as possible. That has to be part and parcel of an innovative society,” said Mr Tharman.
This also where the concept of lifelong learning comes in, he added, to pick up a new set of skills when jobs are lost, and also to deepen skills to stay relevant in the jobs that still exist.
Mr Tharman said the Government is working with the Community Development Councils (CDC) to develop SkillsFuture Engage, which would give individuals advice on how they can advance their knowledge and skills at each stage of life.
File photo of DPM Tharman Shanmugaratnam at a SkillsFuture Credit roadshow. (Photo: Hetty Musfirah)
But companies have to take more responsibility in this effort, he said, noting that there isn’t a widespread management culture in Singapore of wanting to invest in every member of the team.
“It’s not just an HR function. It’s a management responsibility, and we have to have that much more inclusive culture to be widespread amongst management,” Mr Tharman said. “That’s what is going to determine our success – whether we can help everyone to keep learning.”
As for lower skill workers, Mr Tharman said the Government continues to spare no effort to help them. He noted that wages for the bottom 20 per cent of the income ladder have grown significantly over the last time years, as fast as for the average worker.
“So we are quite unusual amongst countries that are the same league as us, because both the average and lower income workers are seeing continued income growth. But it is a challenge to sustain this,” he said.
Concluding, Mr Tharman said Singapore’s greatest strength must remain its ability to help people keep developing through life and to earn their own success in every walk of life: “We must develop every Singaporean so that they can create the best future for themselves, and for Singapore.”
