Weblog -- Economics & Business -- Thursday, 1 May 2003 [ Labor Day ]
Weblog -- Business -- Thursday, 1 May 2003 -- Job Stories and Businessmen's Bearish Sentiments
Job Stories
At the NTUC May Day Dinner, Dr Ng Eng Hen, who is the Minister of State for Manpower and Education at the time and is slated to take over as acting Manpower Minister from 12 May 2003, spoke on the bread-and-butter issues of jobs and wages.
The following points came from a brief report about that dinner speech -- the report appeared in The New Paper (1 May 2003), which is an English tabloid that is somewhat serious in its tone:
- The unemployment situation, or what Dr Ng Eng Hen calls the winter of discontent, does not seem likely to thaw in the year ahead.
- He said the minimum-maximum ratio (the difference between the figures a junior and a senior worker are paid for doing the same job) is down from a high of two or three times, to 1.7 today.
But it must be lowered further, and quickly: "Now, I am afraid we do not have the luxury of time," he said.
"Unless we deal with the problem of seniority-based wages now, many of these long-established companies will face serious difficulty in competing with their competitors that have a younger workforce."
- People are still being choosy about new jobs ..., and some companies prefer immigrant labour over local talents.
He told a story of a company briefing after some foreign workers from Sars-affected countries had to be placed in quarantine.
"When MOM provided lists of local workers ready to meet their staffing needs, half the employers walked out!
"Their message was very clear. They were not interested in recruiting local workers.
"Such an attitude needs to be changed, when there are able local workers available to do the job at the wages offered."
Bearish Singapore Business Owners
Each year, the accounting and consulting firm of Grant Thornton polled several thousand business owners in nineteen developed and developing countries -- including the US and Japan, of course -- and then compiled an annual International Business Owners Survey report. The most recent IBOS report was the result of polling more than 6,000 business owners from those 19 countries, during the 1 Sep 2002 - 21 Nov 2002 period, when the threat of a US-Iraq war was imminent but before the SARS ( severe acute respiratory syndrome ) outbreak got underway on a planet-wide scale from March 2003 onwards.
The 2002 IBOS report showed that business owners in Singapore -- especially those from medium-sized businesses -- were a bearish or downbeat lot: they were more pessimistic than many of their counterparts in the other 18 countries, in their assessment of their own businesses' prospects, whether it be "business profitability, to investment, turnover, export levels and employment."
Some detailed figures are as follows:
- A "balance of 3 per cent" expressed pessimism over turnover levels -- meaning, "3 per cent more respondents in Singapore registered a pessimistic view than expressed an optimistic or neutral view". Contrast this with a "balance of 44 per cent" in the rest of the world that expected turnover to rise.
- A "balance of 25 per cent" of Singapore companies expected profits to drop, while about 31 per cent of their global counterparts expected a rise in profitability.
Clearly, the state of affairs in Singapore was in marked contrast to the overall optimism expressed by bosses elsewhere, during last year [ i.e., in 2002 ].
One partner, a Mr Bill Hutchison, of Grant Thornton's local unit -- Foo Kon Tan Grant Thornton -- reckoned that business morale in Singapore could be even worse now, in March/April/May 2003 and probably for the forseeable future. Said Mr Hutchison, "Those countries that recorded overall optimism are probably now less so, those that were borderline are likely now pessimistic and those, like Singapore which were already pessimistic, will now be much more so. Even before Sars, business owners here were generally far more pessimistic than their counterparts. Singapore, being one of the worst affected by Sars, now sees that situation further exaggerated."
This does not bode well for us in sunny Singapore.