The increasing income gap is a cause for concern. More efforts must be made by firms to train and upgrade the skills of their lower income workers so that they can be mobilized to more skilled work that command higher wages.
Singapore (PRWEB) February 23, 2013
According to a recently-published report by the Singapore Department of Statistics (SingStat), Singapore’s median household salaries have increased moderately in 2012. At the same time, the gap between lower and higher income earners have also widened. Singapore company formation recognizes these trends underscore the need for more efforts to help lower income workers to mobilize towards higher-skilled or value-added functions.
The “Key Household Income Trends 2012” report revealed that the median household income among resident employed households i.e. households of Singapore citizens and permanent residents with at least one member working, has risen 7.5% in nominal terms, or 2.7% after accounting for inflation between 2011 and 2012.
The average income of resident employed households has risen from S$7,040 per month to S$7,570 per month year-on-year (y-o-y). Per household member, the median income has increased from S$1,994 to S$2,127 y-o-y, signifying an increase of 6.7% in nominal terms, or 1.9% in real terms.
In spite of the upward trend in wages, the income gap between low and high income groups have also increased y-o-y. The Gini coefficient, a summary indicator of income inequality, has risen from 0.473 to 0.478 y-o-y.
However, the Gini coefficient fell to 0.459 in in 2012 when government transfer programs are taken into consideration. According to SingStat’s data, overall, households received an average of S$1,340 per individual in government disbursements in 2012. Those in the lower deciles received the most disbursements, up to S$6,140 per member in 1-2 room households or S$1,530 per individual in a 3-room flat.
Commenting on the report, Ms. Christine Lim, General Manager at Singapore work pass specialist Rikvin, said, “A more stringent foreign manpower framework amid a tight labour market has contributed to y-o-y wage inflation domestically. This in turn translates to more Singapore families with a slightly higher spending power year-on-year. Said people may qualify for credit privileges and in turn, have a higher propensity to make purchases on installments, thereby benefitting retailers that have opted for Singapore company formation.”
“However, the increasing income gap is a cause for concern. More efforts must be made by firms to train and upgrade the skills of their lower income workers so that they can be mobilized to more skilled work that command higher wages. Companies can tap various public-funded training programs but must be willing to forgo immediate opportunity costs for longer term gains. By doing their part, they will be doing their part to help lower income families and contribute to the larger good i.e. the national productivity drive,” she affirmed.
Established in 1998, Rikvin has since partnered with thousands of investors, entrepreneurs and professionals in their pursuit to access business opportunities overseas. Rikvin’s areas of expertise include company incorporation, offshore company setup, accounting, taxation and other related corporate services. Rikvin is also a licensed employment agency with the Ministry of Manpower (MOM) and offers a full spectrum of work pass services for foreign professionals who wish to relocate to Singapore.
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