Sunday, April 15, 2012

Wage proposal poses challenges: Teo Ser Luck

SINGAPORE: Minister of State for Trade and Industry, Teo Ser Luck, said the debate on wage restructuring has been "healthy and constructive" but added the proposal by ex-National Wages Council Chief, Professor Lim Chong Yah, poses some challenges.

Mr Teo, who is also Mayor of North East District, said this on the sidelines of a community event on Saturday.



Mr Teo said: "From the business perspective, it's not just productivity increase that we need, we need the economy to do well so that revenue can go up. When revenue goes up, you can better afford higher pay for the lower-income. It's not just the one aspect of just increasing the low-income earner's salary, it's actually an overall aspect of whether the economy is doing well, whether you get the demand for your services and products, whether your revenue would increase, whether you can meet the bottom-line that you've set for yourself.

"If you just go outright, intervene, and increase the income of the lower-wage workers, what will happen is that when you increase the cost of operations for businesses, it will eat into the margin. For SMEs, that's not easy thing to do, because their margin's already very thin. If they're suppliers of services, that margin could be wiped out just like that."

Mr Teo added that the debate on wage restructuring also serves to create an awareness among the public on the challenges faced in coming up with and implementing policies.

- CNA/fa

View the original article here

Source From Channel News Asia

No comments:

Post a Comment