NARROWING “COLLEGE WAGE PREMIUM”
The government will also continue to improve schemes to uplift the incomes of more disadvantaged groups, while closing the country’s wealth gaps over time.
One focus is on Institute of Technical Education (ITE) students and graduates, said Mr Wong, pointing to a “growing divergence” over the past decade between the starting salaries of graduates from ITE and those from polytechnics and universities.
“Their starting salaries have all increased meaningfully in real terms, but those with higher qualifications, especially our university graduates, have been pulling further ahead,” said the Deputy Prime Minister.
“It’s not surprising. It reflects the college wage premium that exists everywhere in the world, but the college wage premium is probably on the higher side in Singapore.”
This has also showed up in the economy, Mr Wong said.
For one, Singapore has “significantly higher occupational wage dispersion” than other advanced economies, especially between those who in more knowledge-based work like managers and professionals and those engaging in “hands and heart” work like technicians and service workers.
“To be clear, we will not be able to completely remove wage disparities in the economy, but too large a wage difference will create problems,” he continued.
“It is partly the source of education anxiety and stress as well because parents and children worry about getting to the ‘right’ pathways that will lead to the ‘right’ jobs for the future.”
Mr Wong said the government “will do all (it) can to reduce these wage gaps, encourage more diverse pathways, and instill dignity and respect for every job, every vocation and every skill”.
This will be done “industry by industry”, through redesigning jobs, raising productivity, upgrading skills and establishing better progression pathways.
“Good” progress has been made in sectors like pre-school education and nursing, and the government is studying how to do the same for other services and professional trades like plumbing and electrical works, he added.
Through industry efforts and close partnerships with ITE educators, the government aims to push up the starting salaries of local ITE graduates, while helping them upgrade their skills over time.
“We will think of ways to do more to help our ITE graduates in their upgrading journey,” said Mr Wong.
But he stressed that the government “cannot achieve all this singlehandedly”.
“It will require all of us – as employers or as consumers – to recognise the important work that our fellow citizens undertake to keep our society going, and do our part to uplift their progress,” he said.