- Joined
- Jul 24, 2008
- Messages
- 33,627
- Points
- 0
<TABLE id=msgUN border=0 cellSpacing=3 cellPadding=0 width="100%"><TBODY><TR><TD id=msgUNsubj vAlign=top>
Coffeeshop Chit Chat - 151st Indian FT editor defends FT policy</TD><TD id=msgunetc noWrap align=right>
Subscribe </TD></TR></TBODY></TABLE><TABLE class=msgtable cellSpacing=0 cellPadding=0 width="96%"><TBODY><TR><TD class=msg vAlign=top><TABLE border=0 cellSpacing=0 cellPadding=0 width="100%"><TBODY><TR class=msghead><TD class=msgbfr1 width="1%"> </TD><TD><TABLE border=0 cellSpacing=0 cellPadding=0><TBODY><TR class=msghead vAlign=top><TD class=msgF width="1%" noWrap align=right>From: </TD><TD class=msgFname width="68%" noWrap>kojakbt89 <NOBR></NOBR> </TD><TD class=msgDate width="30%" noWrap align=right>Feb-2 7:39 pm </TD></TR><TR class=msghead><TD class=msgT height=20 width="1%" noWrap align=right>To: </TD><TD class=msgTname width="68%" noWrap>ALL <NOBR></NOBR></TD><TD class=msgNum noWrap align=right> (1 of 18) </TD></TR></TBODY></TABLE></TD></TR><TR><TD class=msgleft rowSpan=4 width="1%"> </TD><TD class=wintiny noWrap align=right>28093.1 </TD></TR><TR><TD height=8></TD></TR><TR><TD class=msgtxt>This CCB is an Indian FT writing for BT, SPH.
Searching thru the net:
[URL="http://www.sherryart.com/newstory/lynnpan.html"]http://www.sherryart.com/newstory/lynnpan.html[/URL]
Vikram Khanna is an Indian-born, British educated, U.S. resident journalist who left a Washington-based position to spend one year at the Singapore Times. So far it's three years and "it's much too exciting in Southeast Asia to think of leaving."
__________________________________________________________________
Feb 3, 2010
COMMENTARY
The foreign-worker link in growth, productivity
<!-- by line -->By Vikram Khanna , ASSOCIATE EDITOR THE BUSINESS TIMES
<!-- end by line -->
<!-- end left side bar --><!-- story content : start -->
READING some media reports and speculation on the recommendations of the Economic Strategies Committee (ESC), it is tempting to think that the Government is trying to raise Singapore's productivity by cutting back on foreign workers. But if you actually read the ESC report which was released yesterday, you will find that view to be mistaken.
But, first, let's recall another report that was released almost exactly seven years ago, in February 2003, by the Economic Review Committee (ERC). This is what it said about foreign workers, on page 142:
'Without foreign workers manning the night-shifts, there would be no day-shift jobs for Singaporeans. Production costs would go up and companies would be forced to move elsewhere, where workers are cheaper and more readily available.'
The ERC had a point, and it's even truer today, when there are more 'elsewheres' for companies to move to than in 2003.
The idea that cutting back on foreign workers will magically raise productivity is dubious. More likely, such a policy would reduce output and maybe even reduce productivity (which is defined as output per worker).
There is also the lesson of Japan, which does not rely much on foreign workers. In cross-country comparisons of productivity for the years 2006-2008, Japan emerges second best in services, third best in manufacturing, and the best in construction. However, Japan's economic growth has been near zero and its per capita income stagnant - and the absence of foreign workers has added to its ageing problem.
A careful reading of the recommendations of the Economic Strategies Committee (ESC) released yesterday suggests that these important lessons have not gone unnoticed. Contrary to some media reports, the Government is not about to clamp down on foreign workers. The ESC report notes that these workers 'will remain valuable to Singapore' and that 'they fill many jobs for which there is a shortage of Singaporean workers'.
However, it adds that 'we should avoid becoming overly dependent on foreign workers and continuing to increase their proportion of the total workforce over the long term'. Also, the best way to manage foreign worker dependence is 'to raise the foreign worker levies progressively, giving companies time to adjust'.
What this suggests is that (a) the goal is to avoid increasing the proportion of foreign workers in the workforce (emphasis added); (b) this is a secular goal; and (c) companies will be given time to adjust.
In absolute terms, the number of foreign workers could well increase, at least in the short term. Over time, as new skills are developed, the reliance on foreign workers would go down.
It is important to read this correctly, because it can easily be misinterpreted as a foreign workers versus local workers issue; that would be another mistake. Indeed, the ESC also stressed that the aim is to increase productivity of the whole workforce - that is, both local and foreign workers. This means that incentives will be put in place for companies to retain foreign workers so that their skills, too, can be upgraded.
Another issue that needs to be clarified relates to economic growth. If productivity is to be a policy target, does this mean that economic growth will be sacrificed? As Japan's experience suggests, it is possible for some countries to have relatively high productivity growth and low, or even zero, economic growth. But that would defeat the purpose of the exercise, which is to raise incomes.
As it turns out, Singapore's experience is very unlike Japan's: In Singapore, production and productivity tend to move together - last year, for instance, both were negative. Thus, far from sacrificing growth for the sake of productivity, Singapore should do its best to boost it. And at least for the foreseeable future, foreign workers will be needed for that, too.
This commentary appeared in The Business Times yesterday.
</TD></TR><TR><TD> </TD></TR></TBODY></TABLE></TD></TR></TBODY></TABLE>
Searching thru the net:
[URL="http://www.sherryart.com/newstory/lynnpan.html"]http://www.sherryart.com/newstory/lynnpan.html[/URL]
Vikram Khanna is an Indian-born, British educated, U.S. resident journalist who left a Washington-based position to spend one year at the Singapore Times. So far it's three years and "it's much too exciting in Southeast Asia to think of leaving."
__________________________________________________________________
Feb 3, 2010
COMMENTARY
The foreign-worker link in growth, productivity
<!-- by line -->By Vikram Khanna , ASSOCIATE EDITOR THE BUSINESS TIMES
<!-- end by line -->
<!-- end left side bar --><!-- story content : start -->
READING some media reports and speculation on the recommendations of the Economic Strategies Committee (ESC), it is tempting to think that the Government is trying to raise Singapore's productivity by cutting back on foreign workers. But if you actually read the ESC report which was released yesterday, you will find that view to be mistaken.
But, first, let's recall another report that was released almost exactly seven years ago, in February 2003, by the Economic Review Committee (ERC). This is what it said about foreign workers, on page 142:
'Without foreign workers manning the night-shifts, there would be no day-shift jobs for Singaporeans. Production costs would go up and companies would be forced to move elsewhere, where workers are cheaper and more readily available.'
The ERC had a point, and it's even truer today, when there are more 'elsewheres' for companies to move to than in 2003.
The idea that cutting back on foreign workers will magically raise productivity is dubious. More likely, such a policy would reduce output and maybe even reduce productivity (which is defined as output per worker).
There is also the lesson of Japan, which does not rely much on foreign workers. In cross-country comparisons of productivity for the years 2006-2008, Japan emerges second best in services, third best in manufacturing, and the best in construction. However, Japan's economic growth has been near zero and its per capita income stagnant - and the absence of foreign workers has added to its ageing problem.
A careful reading of the recommendations of the Economic Strategies Committee (ESC) released yesterday suggests that these important lessons have not gone unnoticed. Contrary to some media reports, the Government is not about to clamp down on foreign workers. The ESC report notes that these workers 'will remain valuable to Singapore' and that 'they fill many jobs for which there is a shortage of Singaporean workers'.
However, it adds that 'we should avoid becoming overly dependent on foreign workers and continuing to increase their proportion of the total workforce over the long term'. Also, the best way to manage foreign worker dependence is 'to raise the foreign worker levies progressively, giving companies time to adjust'.
What this suggests is that (a) the goal is to avoid increasing the proportion of foreign workers in the workforce (emphasis added); (b) this is a secular goal; and (c) companies will be given time to adjust.
In absolute terms, the number of foreign workers could well increase, at least in the short term. Over time, as new skills are developed, the reliance on foreign workers would go down.
It is important to read this correctly, because it can easily be misinterpreted as a foreign workers versus local workers issue; that would be another mistake. Indeed, the ESC also stressed that the aim is to increase productivity of the whole workforce - that is, both local and foreign workers. This means that incentives will be put in place for companies to retain foreign workers so that their skills, too, can be upgraded.
Another issue that needs to be clarified relates to economic growth. If productivity is to be a policy target, does this mean that economic growth will be sacrificed? As Japan's experience suggests, it is possible for some countries to have relatively high productivity growth and low, or even zero, economic growth. But that would defeat the purpose of the exercise, which is to raise incomes.
As it turns out, Singapore's experience is very unlike Japan's: In Singapore, production and productivity tend to move together - last year, for instance, both were negative. Thus, far from sacrificing growth for the sake of productivity, Singapore should do its best to boost it. And at least for the foreseeable future, foreign workers will be needed for that, too.
This commentary appeared in The Business Times yesterday.
</TD></TR><TR><TD> </TD></TR></TBODY></TABLE></TD></TR></TBODY></TABLE>
