SBF warned that the proposal to lift wages of the lowest- paid by more than 50 per cent over three years would have ‘untoward consequences’.
Government officials and the labour union leadership says it was risky and that there are better ways to reduce the income gap and tackle the problem of low productivity among firms.
Mr. Chan, who is also the founder and chairman of interior decoration company Goodrich Global, thinks that firms can endure a sharp 20 per cent increase in wages for one year, but they will need to justify the increase over the next two to three years through higher sales or profits. Bosses will need to find ways to make workers do more higher salaries or raise revenues to pay for the higher wages.
Source: Straits Times Newspaper, Prime News (Friday, April 27, 2012) by Aaron Low, Economics Correspondent