TR EMERITUS

Click to enlarge Recently my eye was drawn to an article on state media’s clickbait site AsiaOne about an expat’s $11,650 a month basic living expenses. It says she is an expat despite the article revealing that she has been living in Singapore for 10 years.After so long she and her partner should have been eligible for PR, and probably for citizenship provided they had no criminal record and had proven themselves to be loyal supporters and propagandists for the brilliance of the PAP Government, or at least with the good sense to keep their mouths shut and not express any anti-death penalty views or show support for other social causes. However, like a lot of expats in Singapore with male children she has probably been renewing her Employment Pass regularly rather than taking up PR so that she and her son can continue to enjoy all the socioeconomic benefits of living in Singapore, with low taxes and domestic slaves, sorry FDWs, at their beck and call without any of the unpleasant burdens placed on ordinary Singaporean men such as having to give up two years of potential earnings to serve the forced labour tax that is NS. The expat household’s total income is undoubtedly substantially above $11650. The female expat states that this does not include her personal expenses on items like skincare nor the family’s shopping nor does it include costs of holidays or savings. Neither does it include income tax which would be around 10% of income at that level. I assume medical expenses and insurance would be covered by their employers as would probably be membership of a pension scheme. Together these expenses should add up to at least 17% of income so the same level as Employer CPF but Employer CPF is not payable on salaries above $6,000. Taking these extra expenses into account and making allowance for income tax then conservatively the expat household’s total income, including likely employer payments for health insurance and pension fund contributions, would mean that their total income could be conservatively 40% higher than their basic living expenses so around $16,300 per month. I have not made allowance for school fees for an international school which the expat does not mention but these would probably be paid by her employer and should be included in income. If we took these into account they would probably add on about $3-4,000 per month to the household’s total expenses. Even without adding on school fees (it is not clear from the article whether tuition fees of $900 and extra activities’ fees of $800 are on top of or her son’s total education costs) household income of $16,300 per month would place them in the top 15% of resident employed households by income (excluding employer CPF contributions). If we add on another $1,000 to represent employer CPF contributions then they would still be in the top 20%. However if we assume that international school fees are paid by her employers then the household’s income would be around $20,000 per month which would place them in the top 10% of earners. And remember that the statistic for incomes of resident employed households is the Department of Statistics does not break out separate figures for the incomes of Singapore citizen households which would probably be lower, perhaps significantly, as residents would include PRs whose income is likely higher on average than Singaporeans. The household here may be PRs. While PRs are only about 20% of the citizen population it is likely that a significantly higher percentage work. I estimated the PR labour force participation rate at 80% in arriving at my conclusion that possibly as many as half of Singapore citizens have withdrawn from the labour force because of the difficulty in finding work that paid a living salary. Even though this household’s income would probably place it in the top 10-20% of Singaporean (including PR) households by income they are probably below the median income for expat households since their rent of $4,000 per month for a two bedroom flat seems on the low side. According to AsiaOne she works in the dental industry and one has to wonder why we need expat dentists when Singapore is not short of qualified dentists and many more graduate every year. Perhaps she is only a hygienist and her partner is the main earner. Singaporeans should still ask themselves why even low ranking expats earn so much when all their fringe benefits are included and why it is still worthwhile to employ them when they are so much more expensive than locals. Also why should they receive so many benefits like low taxation when they do not have any of the burdens of Singaporeans, like NS and reservists? The persistence of such large differentials for so many years despite strong economic incentives to reduce them might be the result of a lingering colonial mentality which assumes that anyone of white skin, or indeed any foreigner, is better than a local and reinforced by a deliberate PAP policy of subsidising FTs. Keeping Singaporeans insecure and fearful of being displaced in their own country while promoting a large class of foreign sycophants has always been part of the PAP’s agenda for decades. Remember LKY’s words about Singaporeans needing a spur in their side from immigration to avoid them becoming complacent and lazy? Every time LHL and his MInisters start clamouring that Singapore needs to remain open to global talent if it is to survive, Singaporeans should demand a level playing field as a minimum.   Kenneth Jeyaretnam   About the author: I’m a Singaporean economist who became an opposition activist. I blog to provide an alternative to the porkies that the Pinkies tell. It just so happens that my alternative is the truth. That’s why I’ve never been sued in any civil or criminal court no matter how hard hitting my criticism. I’m quoted and interviewed and asked to speak across the world but largely censored in Singapore in an effort to silence my political opinions. The left hate me because they think I split their vote and because I eschew their outmoded economic models. Models that don’t work. The Right and the Conservatives hate me because I’m a liberal. I’m not sure what the middle think of me. I don’t think there are more than a handful of people in the middle, here in Singapore. I’m a Singaporean born and bred, dual heritage, my parents Singaporean established here before the State of Singapore was created. I’m not Eurasian. I read economics at Cambridge and could be broadly described as from the Keynesian school but I believe in interventions. I was formerly a successful hedge fund manager. After economics and politics my greatest interests are history, film and Makan. I run but I run so I can eat like a Singaporean.      Read More →

Now that the first few days of Chinese New Year have ended, its time to address the taboo topic of getting screwed. Like it or not, the reality on the ground in just about every corner of the globe is gloomy and there’s a good chance that one is going to get screwed. Unless you’re at the level of being paid in stock options or you work in the insolvency business, be prepared for pay stagnation, pay cuts or being retrenched. Let’s face it, even big tech companies with large reserves of cash are laying off people. So, what can one do in such an environment? Well, one needs to start with the mindset. As is often said, you need to hope for the best but expect the worst to happen. That way, if you don’t get screwed you can count your blessings. However, if you do, you are prepared for it. Preparing for the worst, means understanding that concepts like the “Iron Rice Bowl” are things of the past. Employers have the ability to find someone younger, cheaper and more compliant than you and the loyalty that is demanded of you is not something that is necessarily going to be reciprocated. So, if you start with that, you will understand that having a single income from a single source is not wise. Not having cash in the bank is downright foolish. So, if you have a salary, no matter how small, make it a point of setting ten percent of your take home pay at the very least. The reality of life is that bills will need to be paid even if you don’t have a job. Cash in the bank will allow you to tide things over if you were to lose your income. I will confess that I have not been good at saving cash in the bank. Last year, I had several occasions where I thought I was on the way to saving but things happened along the way and I had to draw out the cash. Hopefully the rabbit year will allow me to keep things on the side. I also set aside some funds in CPF. The system in Singapore isn’t perfect but its better to have more inside than less. So, I try to contribute to my special and medisave accounts, which happen to be the only places that pay four percent a year in annual interest. In addition to feathering the nest, one also needs to develop a second income stream in the event that you lose the first one. Most employers make you sign a contract that forbids you from taking on another job. There’s also the fact that most jobs are designed to drain you of energy and for most people, the idea of working a second job is a non-starter. However, developing a second income stream is essential if you are to find any form of security in an environment where getting screwed is a given. I was lucky in the sense that my employer allowed me to continue working at the Bistrot and I took great pride in working two jobs. However, Covid put an end to my side gigs in restaurants and so, I focus on blogging when I am not at my day job. The blog has not replaced my gig I had at the Bistrot. Advertising revenue takes several years to pay off ($150 to pay out) but it still helps go towards savings. I do get a small royalty once in a while for sites that pick up my pieces. It’s not much but every little extra counts. I know of people who have taken to driving grab and I believe that people should be allowed to do things like rent out rooms on AirBnB. Simply put, developing side hustles allows people to be less beholden to a single employer, which is admittedly something the Singapore government does not want (given that it sells the fact that it can provide a compliant workforce to multinational investors). No matter how small ones’ side hustle is, it is still vital to have one. Even if you never need to replace your main income, the few extra pennies that come from the side hustle can help feather your nest. Given that I work in liquidations, my strongest advice to anyone who works for a company going into liquidation is never depend on the liquidators to pay out. Whilst employee salaries are considered “preferential” payments in a liquidation scenario, the fact remains that the company went into liquidation because it didn’t have the means to pay bills, including yours. Liquidators are under no legal obligation to pay your salary and they spend most of their time trying to salvage what little that’s left of the company. Liquidation dividends are often paid in cents on the dollar owed and you never know when you can get the money. Whatever you get out of a liquidator is a bonus. So, if your employer is struggling to pay your salary, start looking for alternatives and move on. If there is a problem paying a month’s salary, its very likely they won’t be able to pay two. Watch out for stories about how well the company is doing or a creation of reasons as to why you cannot get what is due to you. The world economy is going through a rough patch and it is unlikely to get better anytime soon. The wisest thing to do is to prepare for the worst.   Tang Li *Although I’ve been based mainly in Singapore for nearly two decades, I’ve had the privilege of being able meet people who have crossed borders and cultures. I’ve befriended ministers and ambassadors and worked on projects involving a former head of state. Yet, at the same time, I’ve had the privilege of befriending migrant labourers and former convicts. All of them have a story to tell. All of them add to the fabric of life. I hope to express the stories that inspire us to create life as it should be.      Read More →

1. Several big tech companies are laying off a large number of tech workers due to the weak economy which may soon enter into a recession. a) Google will retrench 12,000 workers, representing 6% of the workforce. b) Meta (Facebook) will lay off 11,000 workers, representing 13% of its workforce. c) Microsoft will lay off 10,000 workers, representing 5% of its workforce. d) Twitter will lay off 3,000 workers, representing 40% of its workforce. 2. The workers that are laid off by these tech companies are mostly engineers and developers who earn high salaries. How will a large number of laid off workers affect the economy and the laid off workers? 3. Someone observed that these laid off workers enjoyed high salaries during the past years. They are likely to have sufficient savings and may be able to ride through several months of unemployment until the economy recovers. 4. Some of them might have taken two jobs to earn two full incomes. They were able to do two jobs as they were not closely monitored while working remotely at home. 5. However, some people said that many of these highly paid workers might have made heavy commitments to purchase an expensive house or car, and will have difficulty to meet the loan payments. 6. The scale of the job cuts appear to be quite large, and may have a serious cascading impact on the economy.   Tan Kin Lian      Read More →