Prime Minister Lee Hsien Loong's National Day Rally speech on Sunday cited plans to use the local qualifying salary (LQS) to raise the pay of Singapore's lower-wage earners. Also announced was the coming provision of legal sanction to the fair employment watchdog to protect Singaporean workers from discrimination. These are major moves to ensure that Singaporeans, including lower-wage earners, have a good chance of fending for themselves and their families as the country makes the transition to the new economic normal produced by the coronavirus pandemic. Clearly, the well-being of workers must remain centre stage as Singapore, having weathered its worst economic crisis since independence, changes gears to focus on the future.

The LQS, an extension of the Progressive Wage Model (PWM), would require companies hiring foreign workers to pay all their local employees at least $1,400 a month, a figure that will be adjusted from time to time. What the move does, essentially, is to ensure that Singaporeans, no matter where they are on the employment ladder, enjoy at least a living wage, given that the basic needs of a four-person family amounted to $1,300 based on estimates from 2017. The LQS mechanism, like the PWM, avoids the twin pitfalls of a completely unregulated labour market and one where the institution of a national minimum wage, while well-intentioned, skews hiring practices to the ultimate detriment of the prospects of workers themselves.