Misconception of salary

THE ECONOMY DOES NOT PAY PEOPLE WHAT THEY DESERVE TO EARN.

1) Increased Productivity does not mean a higher salary

If you were to be paid what the market thinks you deserve then you would probably find your income levels dropping at an alarming rate. How can this be?

This is because the salary of workers in the developed world is protected from the pressures of the market. For example, whatever your job, there will be people in other countries who will do it for less money. You aren’t subjected to this competition because the government protects your job. The government uses strict immigration controls to prevent people from poorer countries from entering the workforce. Safe from these workers, your salary remains artificially high.

It is also not your skills or productivity that determine how much you earn, but purely the society you live in. If you happen to live in a prosperous, productive society, your salary will be pulled up by everyone else. Even if you happen to be the laziest, most unproductive worker, you will still earn more than a hard worker in a poor country.

For example, a bus driver working in Singapore earns a higher salary than a bus driver in Malaysia. I believe the road condition and traffic condition in Malaysia will require the Malaysian driver to be more vigilant and more skillful than his Singapore counterpart, but this is not reflected in their monthly salary.

2) Currency is a tool to increase the welfare of the general mass

The government has been deflating its currency to increase the competitiveness of the nation’s export. This may be good for the country’s GDP but its benefit is only retained by a small pool of people who own businesses, foreign assets, or debt. In contrast, the majority of us have to face higher inflation due to higher prices of imported goods.

SGD, which has been pretty strong over the past few years has attracted talents all around the world to work in Singapore. The starting salary for fresh graduates in Singapore is way higher than in developed countries such as Japan and the United Kingdom. This acts as a strong magnet to attract skilled and talented workers to work in Singapore. As a result, this pool of workers will create a prosperous and productive society, pulling up everyone's salary.

If a nation's currency keeps falling, not only talented workforce shun from the country, even unskilled labor snub it too. Did you realize there are lesser Indonesian working in the construction industry and lesser Thai girls working in the entertainment industry compared to five years ago?

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