Lim Hng Kiang, Economy
Wage share of GDP has risen over the decades: Minister for Trade and Industry
Published on Mar 6, 2013 12:45 PM
The share of gross domestic product (GDP) going to wages has risen slightly over the past three decades. In the 1980s, wages made up 41.8 per cent of GDP on average. This rose to 41.9 per cent in the 1990s, and to 42.5 per cent between 2000 and 2009.
Minister for Trade and Industry Lim Hng Kiang shared these figures in Parliament on Wednesday, in response to a question by Nominated MP Eugene Tan.
Mr Tan had also asked for the ratio of wages to profits earned by the private sector. Though this breakdown was not available due to data limitations, Mr Lim gave the ratio for the economy as a whole: the ratio of wages to profits averaged 0.83 in the 1980s, 0.86 in the 1990s, and 0.85 between 2000 and 2009.
Mr Tan's question came after Workers' Party MP Gerald Giam noted, during the debate on the Government's White Paper on Population last month, that Singapore's wage share of GDP was relatively small compared to other developed countries.
In that debate, Mr Giam noted that wages accounted for 42.3 per cent of Singapore's GDP in 2011, compared to 47.5 per cent in Australia, 49.2 per cent in the European Union, and 52.3 per cent in Canada.
He attributed this difference to the ready supply of cheap foreign labour, which "lowered the bargaining power of local workers, forcing them to accept lower wages in order to be competitive" and allowed GDP growth to go to profits instead of wages.