The population must continue to grow…for now

In my earlier post, I stated why Singapore won’t be overcrowded even with a 6.9m population. But assuming we can stave off over-crowding, we should still ask why Singapore’s population has to grow in the first place. The short answers are: Blame the baby boomers, and blame our societal expectations.

Blame the Baby Boomers

Why “Blame the baby boomers”? Because Singapore is about to face one of its largest demographic changes in the next 2 decades – a doubling to tripling of elderly folks. (I will be one of these elderly as well.) The chart below shows that this “silver tsunami” is nearly upon us.

age profile

This large influx of elderly is unprecedented in our young nation’s life. The productive years of the baby boomers helped keep Singapore’s tax base low because we had many working adults paying for very few elderly and a shrinking base of children. In the future, much fewer working Singaporeans will be supporting the elderly and the young. I will not be surprised to see my children grow up with higher income taxes and GST being imposed on them.

If taxes must eventually rise, they should not rise so much that it deprives our future generation of the standard of living that we enjoy today. A very real example is happening in my family today. Today, my 3 siblings and I spread out the cost of caring for my parents, but in the future the cost of taking care of me will be borne by my 2 children only. It therefore makes some sense at the “country level” to absorb some foreigners to spread out the tax load.

There is a common netizen complaint that the PAP is treating its citizens like economic digits when it explains why foreign workers are needed. To me, this is a hollow complaint that can only come from people who take today’s “good life” for granted. You can be idealistic about the political future of Singapore, but you must also temper it with the realities of the world we live in. Idealism cannot wish away the silver tsunami and its future cost to the younger generation. To the PAP’s credit, they are trying to use policy to reduce the future cost impact to the younger generation, so that the younger generation can chase their dreams like we did.

The litmus test will eventually come when GST is set to rise. (Why GST? Because a consumption tax is more efficient at generating revenue from tax dodgers.) I won’t be surprised to see a 10% GST in future. How many Singaporeans are willing to see a GST increase without complaining, if they knew that the revenue will be used to pay for  elderly care?

We will also need more actual foreign labor to take care of the elderly. My sister who works as a nurse tells me that the local nurses are being prioritised for the community hospitals which are closer to the ground and therefore interact more frequently with the elderly who cannot speak English. Many more foreign nurses are needed to support the doctors in our hospitals. Singapore may train as may bright young doctors as it wants, but they are useless.

Blame our societal expectations

The second reason why Singapore’s population will need to grow for now is due to our expectations on our children. As more Singaporeans receive a better education, they will aspire to higher paying white/blue collar jobs. No one will want to take on low-paying support jobs like being a cleaner. But somebody has to do the work.

Singapore’s population cannot grow forever. Even the PM has said that in 2030, the target population should be less than 6.9m. The question then is what Singapore would look like when our population stabilises.

There are two HR models that Singapore could adopt:

  • One is to be Nordic, where the entire local population handles all kinds of work from the low-skilled to the high-skilled. This requires Singaporeans to break the mindset that blue collar work is “lower ranked” and should be avoided. It will also mean that Singaporeans must be willing to pay blue collar workers much more than today, so as to be on par with white collar pay.
  • The other is to be Dubai, where the local population concentrates itself on higher tier work. Foreign transient workers are used to handle the lower-skilled work.

It should be obvious to the reader that the PAP has chosen to emulate Dubai over the Nordic countries. I believe the Dubai model makes sense for a small country like Singapore, even though the Nordic model may be a more economically sustainable model. This is because the Nordic model is not culturally sustainable in Singapore. The Nords require 80% of their population to be working, with a large proportion in the low/mid-skilled blue collar sector. But few Singaporean parents are willing to let their children grow up to work in the low/mid-skilled sector, and few Singaporeans are willing to pay more for the same service. I suspect that such mindsets will take a long time to change, if that were even possible.

So if we want to cater to the dreams and aspirations of our local citizens, then we must have someone else to do the lower-skilled “dirty work”. There will always be some other country lower than Singapore in the development ladder, so we will continue to have “unlimited” supply of cheap foreign labor for the foreseeable future.

Furthermore, there is a future wildcard that may cause the Nordic model to collapse, and that is technology. When you think about how technology has changed jobs over the last 40 years (such as the death of typewriters and the birth of word processors and cloud computing), it is possible that similarly disruptive technology will change the jobs of the future. The jobs that are most at risk of being replaced by robotic technology are the lower-skilled jobs. One can only imagine how the Nords will react when a significant portion of its population finds itself out of a job because it was replaced by robots. This is why I have also told my children that they must continuously improve themselves because the competition is not just from foreigners, it is from technology as well. You can keep the foreigner out of our shores through immigration laws, but there are no laws against being replaced by a robot.

Once we have safely traversed the silver tsunami in the coming decades, it may actually be possible for Singapore’s population to start shrinking progressively without disrupting our livelihoods. Our TFR will probably never reach 2.1, because the experience of all developed countries is that education is the best contraception. When we have less locals and less need for fervent construction, we can also afford to have less foreigners to support locals and our construction needs.

Advertisements

About sgthinker

I'm a 40-year old Singaporean male, and this blog pens down my thoughts and feelings about Singapore's political happenings, government policies and society trends. I hope this blog will provide a moderate voice in the growing online debate about the state of Singapore's society. Some of the posts here won't be solely written by me, since there will be times when other writers are more eloquent at expressing their views, in which case I'll share their insights (along with my comments). The content on this blog is owned by me.If you wish to share or reproduce the content, please attribute it to this blog.
This entry was posted in Uncategorized. Bookmark the permalink.

24 Responses to The population must continue to grow…for now

  1. rick tan says:

    fuck you, asshole

    • Rick tan's mother says:

      Using profanities in a intelligent discussion with your belligerent attitude simply shows what a low level degenerate you are. Learn to be civilised and get an education before you crawl out of your dustbin and join society

  2. Hunky says:

    The premise that the young pays for the old (via taxes) within in the Singapore context is largely unsubstantiated. We don’t have pension or welfare system and our hospitals in Singapore are financially self-sustained. In fact, if you are old and poor today and you approach the government, precedents show that they will either sue your children for not providing support, or they will force you to sell your property through lease-buy-back scheme. So unless you are claiming that in future old people have free health benefits, free transport, etc, I don’t see how in future old people will be a burden on society.

  3. Pingback: Leong Sze Hian: Talking cock or intellectually dishonest? | sgthinker.wordpress.com

  4. Sim Sze Keen says:

    With regard to “low-skilled” jobs, I believe a better solution would be to re-configure and where possible mechanize some of the tasks. I disagree with sgthinker that simply because a prejudice against these jobs exists in some people, nothing can be done about it except to import large numbers of foreigners. Isn’t the traditional Chinese mindset very much against soldiering ? The proverb goes “good iron isn’t used to make nails” but we’ve managed to change that to a great extent and are marking 45 years of National Service now. If we follow sgthinker’s line of reasoning, then we would not have instituted NS but instead employed mercenaries instead !

  5. Sim Sze Keen says:

    You are assuming that the large numbers of foreigners invited in by the PAP will be content to leave Singapore after the “silver tsunami” has passed. You are assuming that the entire social fabric, cultural identity and value system of our society survives this onslaught of foreigners substantially unaltered. You do not consider other methods of coping with the task of caring for an elderly population which does not entail mass importation of unskilled foreigners e.g purpose-built, high-tech, elderly-friendly facilities. You blithely dismiss the Nordic model by asserting without the slightest shred of evidence that Singaporeans would necessarily disdain “low-skilled” jobs. I think you would be surprised at how Singaporeans would rather do these honest and essential jobs themselves rather than tolerate the “foreigner tsunami” proposed by the PAP. The White Paper is long on assertion and short on substantiation. Before we embark on such a momentous social experiment, we should consider ALL alternatives at length, in detail and in a transparent manner ; NOT railroaded through parliament in 5 days. Most developed nations are facing a declining birthrate and consequently an increase in the elderly population. None of them have contemplated such drastic and untested measures. Are we to suppose that the PAP has found a panacea that has eluded the think-tanks and the governments of all these other nations ? Or, is it likelier that such a course of action is so fraught with dangers and uncertainties that no one else has been rash enough to pursue it.

    • sgthinker says:

      No ned to assume that the foreigners will be “content to leave”. Once work permit expires, it’s illegal to stay anyway.
      Also, nursing is not an unskilled job. Don’t make the same mistake that Teo Chee Hean did.

      • Sim Sze Keen says:

        Yes, all that is needed to get hundreds of thousands of foreign workers to leave promptly is to gently point out to them that it is illegal. Naturally, they wouldn’t ever want to do anything illegal would they ? If for argument’s sake, these thousands of people overstay or claim the right to stay based on their perceived contributions, it would be extremely difficult to deport/expel this very large number of people without a major military style operation which would presumably have to be carried out by “native” Singaporeans.

        Yes, nursing IS a skilled job and so that refutes your argument that Singaporeans would necessarily refuse to do it.

      • sgthinker says:

        Sim, considering that we have been using work permits to control the movement of hundreds of thousands of transient foreign worker population for over 2 decades, I think it’s safe to say that your fear that these people will not want to leave is unfounded.

        And if you do not know how severe our nursing shortage is, pls google it or ask someone working in the healthcare sector.

      • sgthinker says:

        Lo and behold, our nursing shortage made front page news on the Straits Times today. Check it out.

    • Xmen says:

      I agree that there is no evidence that Singaporeans would necessarily disdain “low-skilled” jobs However, there is plenty of evidence that Singapore government actively suppresses the pay of these “low-skilled” jobs locally by importing massive number of workers from developing countries.

      If you compare the pay of these “low-skilled” jobs to that of other big cities (note: Singapore is among top 10 most expensive cities in the world), you will find that these local jobs are paid far below living wages.

      Are you aspiring to first world Swiss standard of living or that of a developing country?

      • sgthinker says:

        Thus my article points out that there are 2 HR models. The Nordic model where low-skilled jobs are paid more, or the Dubai model where low-skilled jobs are paid less.

        Does a Swiss standard of living mean that we must copy the Swiss policies all the way? What matters is the living standard applicable to locals, and I believe that low-skilled locals can still achieve a decent standard of living through targeted cash/CPF transfers.

        If you believe that locals will not necessarily disdain low-skilled jobs, you are welcome to encourage your siblings and children to take on those jobs.

      • Xmen says:

        FYI – Many white collar jobs in Singapore are paid less than blue collar jobs (or what you called “low-skilled” jobs) in developed countries. People in developed countries don’t “disdain” blue collar jobs. Perhaps it is your personal bias or a Singapore phenomenon.

      • sgthinker says:

        In societies where blue-collared jobs are better paid, this is accompanies by a willingness of society to pay more for services. Not sure that applies in Singapore, where it is common to hear people complaining about how chicken rice costs $3 when it used to be $2. Hence my view that it is a cultural thing.

  6. dude says:

    how about discussing what happens when the 1.5mil ppl the govt imports grows old, what happens to them then?? if you import ppl of average age of say 30yrs old today, you are actually bringing the so called elderly “problems” earlier… so how??

    • sgthinker says:

      There are two types of foreigners.

      One group is transient and does lower-skilled work like construction, domestic work etc. This group won’t have a chance to grow old in Singapore because they will be kicked out when their work passes expire. This group makes up majority of our imported foreigners.

      The other group convert to PR and citizens, and is more likely to grow old in Singapore. But since this people are more likely to be productive workers and they must contribute to CPF and medisave, they contribute to our tax revenues and have to bear a significant portion of their own “elderly cost” when they grow old..

  7. bystander says:

    You mentioned that currently you have 3 other siblings to take care of your parents, in future you see that you have only 2 children to take care of you.

    I would like to understand from you how is the govt paying or helping you with your parents now? In future if we have a population of 6.9m, will it mean that the govt will chip in more to support you and relieve your 2 children of some burden?

    • sgthinker says:

      There is no difference between the govt or me paying for my parents’ upkeep. This is because the govt’s money is taxpayer money that comes from me anyway.

      The same will apply in future with my children. My 2 kids will have to support me either through their own pocket or through their taxes. That said, my kids will have some relief because I will have my own CPF and medisave to support me at least part of the way.

      • Xmen says:

        Interesting… In nearly all developed countries, people save for their own retirement or the government finances retirees through some form of pensions. Counting on your children to support your old age is definitely unwise. Your children may not even have enough to provide for their own families. In addition, with TFR at 1.2, a couple will have four parents and a child to support. Are you serious?

      • sgthinker says:

        My pt is that govt pensions (the kind that existed before CPF was created) are financed by working taxpayers. Even if I do not draw on govt pensions, the cost of building social infrastructure like hospitals, eldercare facilities etc are paid for by working taxpayers. Which effectively meaning that my children are paying for part of my retirement even if I refuse to accept any of their money.

      • bystander says:

        Thank you for your reply

  8. Xmen says:

    When I first read the title “The population must continue to grow…for now,” my initial reaction was yeah sure, until PAP got kicked out 😉

    I find it amusing that you buy into LHL’s spin (“Even the PM has said that in 2030, the target population should be less than 6.9m.”) Be real, do you believe a liar who wants to borrow $10,000 from you but claims that he won’t be using up all $10,000? Think think think…

  9. Pingback: Daily SG: 13 Feb 2013 | The Singapore Daily

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s