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Technology to have greater impact on wages, income inequality: PM Lee
EVEN as Singapore continues to calibrate its foreign worker inflow, Prime Minister Lee Hsien Loong yesterday said the bigger concern over wages and social inequality comes from technology rather than globalisation.
Speaking at a dialogue session moderated by DBS CEO Piyush Gupta, Mr Lee noted that income inequality has partly been a result of China and India entering the global economy, with the large masses of workers out of the two large economies outpacing demand.
"But as China develops, as India develops, the companies will grow, the entrepreneurs will grow," he told a conference hosted by the Indian Institute of Management. "There's no reason you should fundamentally be having a surplus of workers, and not enough jobs to tilt the balance against workers," adding that wages in China have already been increasing.
But while globalisation has a transient impact on wages, the same cannot be said for technology, which could make the worker more productive, but also dumb down the job, Mr Lee said.
"If the worker is highly productive, but doesn't need much skills to do it, then any worker can do it, and he's not going to benefit from his contributions. Whoever writes the next operating system, or designs the next robot - he is going to benefit from it. So that part is something which we will have to watch very, very carefully."
Even as the government helps companies in Singapore adapt to more productive measures, it has no control over the pace of change brought about by competition. Mr Lee cited the example of Uber, which has generated enormous concern around the world as it disrupts the pricing model for transport. In Singapore, GrabTaxi has done so in a similar fashion, said Mr Lee. While the government can maintain an even playing field, it also wants to make sure Singapore is not held back simply because competition has made it painful for the incumbent, Mr Lee said.
"In 10 years, you don't know what the new possibilities will be, but I think we can be faster than other countries in seizing them, and in adapting ourselves to them," added Mr Lee. "I don't accept for a moment that we've done everything that can be done in Singapore. We're not at the limit."
He acknowledged that rapid change can cause discomfort for Singaporeans. "Our population is aging, we have to take care of our old folks, and give them assurance and security. But the purpose of life is not assurance and security. The purpose of life is to use that security in order to achieve something new and different, and do better than the people who came before."
Speaking on India, Mr Lee noted that India has not shown the same clear focus on development as China has. India can, for example, make better use of its tremendous diaspora, as China has, and display confidence in linking with the world.