VIEW: Pressure on Singapore's middle class rising
By Seah Chiang Nee in Petaling Jaya/The Star | Asia News Network*–*Sat, May 5, 2012
Petaling Jaya (The Star/ANN) - Singapore's P-MET (pronounced Pee-met) - the acronym for Professionals, Managers, Executives and Technicians, a flourishing group of people who make up 51 per cent of the workforce - is under stress.
Most are, of course, university graduates or diploma holders, whose numbers and role in society had steadily increased because of strong growth and people's determination to get higher education.
In turn, it helped to shape Singapore into what it is - a rich, middle-class society.
The first blow was struck by the demise of the industrial era here as well as the emergence of competitive giants like China and India that pushed down wages everywhere.
Factories were closed or moved overseas and mass retrenchments followed, including executives and managers.
A series of downturns and recessions added to the toll. In 2008, for example, 43.3 per cent of retrenched Singaporeans were from this group.
A new shadow now looms. This is the arrival of a small army of hungrier foreign P-METs who are always ready to accept lower wages.
Singapore is a middle class city. An estimated 70 per cent of citizens consider themselves middle class rather than working class.
The influx of one million workers in the past 10 years included many poorer paid P-METs from India and the Philippines. Many ended up in finance, computer and multinational corporations, some of them easing out locals.
The arrivals are a mixed bag. The majority comprises lower-paid workers, but also includes many extremely rich settlers.
The demographic infusion is continuing but the government, responding to public pressure, has recently reduced the number of approvals given out.
It has eroded bit by bit the Singapore middle-class, already hit by economic changes.
Another effect of globalisation is the monthly departure of 1,000 Singaporeans to settle abroad for better opportunities and a more relaxed lifestyle.
In the past 10 years, 97,990 Singaporeans (excluding small children), had left, the government said. Many are young and well-educated professionals.
The erosion of the middle class was first noticed three years ago in Japan, and to a lesser extent in Hong Kong and Taiwan before arriving here.
It was enunciated as the M-shaped society by Japanese strategist Kenichi Ohmae, who noticed that among middle-class workers in Japan only a "very few" made it to the rich, while a greater number actually sank to the lower classes.
For some middle-class Singaporeans, this sounds uncomfortably familiar.
The gap between rich and poor in Singapore is the second widest in the world, and the government has promised utmost efforts to put it right.
For the government any weakening of the middle class is bad news.
Who forms the middle class?
There is no universally accepted definition, but Singaporeans generally base it on earnings. People who earn S$4,000-S$7,000 (RM9,800-RM17,200) are considered middle and upper middle classes.
Former Prime Minister Lee Kuan Yew once said that any political party that wanted to win power in Singapore must win the middle class.
The mass arrival of foreign professionals into the marketplace is causing the government dearly in public support - as shown in last year's general election.
Former Director of Internal Security Department (1971-74) Yoong Siew Wah wrote that "Singapore has 30,000 P-METs who have been unemployed for quite a long time, and we now have Chinese and Indian immigrants competing ... for the limited employment opportunities".
What do the unemployed P-METs do? Many work as taxi drivers, property agents, insurance agents, financial advisers, remisiers, or tuition teachers, said a surfer.
In recent years, the Lee Hsien Loong government responded to the furore by cutting down the number of foreign PRs and raising the pay ceiling for foreign professionals.
He also pledged priority efforts to narrow the income gap between rich and poor.
Commentator Patrick Loh said: "If you look around, Singaporeans have lost many middle management and higher management jobs to foreigners for the past decade.
"They are still losing these to them. The painful part is losing these jobs to lesser qualified candidates, just because they appear to fit the role better with a cheaper pay package," he added.
There is another compelling reason why the People's Action party (PAP) wants to keep educated youths employed.
Former Prime Minister Lee Kuan Yew told accompanying journalists to India years ago that his government would want to avoid his host's plight. Their universities were churning out too many unemployed graduates.
Recollecting from memory, I gather his rationale being: These unemployed graduates have the knowledge and free time to plan revolutions. They would hang around in coffee shops and talk politics, and soon a revolution brews.
Recently, an Education Ministry official was reported to have told a US diplomat (source: Wikileaks) that Singapore did not plan to encourage more students to study in university, and the campus enrolment rate would stay at 20 per cent-25 per cent.
I wonder, if this is true, is it connected to concerns about the possibility of unmanageable unemployment among graduates here?
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Originally Posted by phantom_opera
