Lifestyle

A S’pore Economist Just Said That 5-Figure Monthly Income is ‘Below Average’

Boon Hun

2018-02-18 , 12:18 am

Just a couple of days ago in February, a Singaporean family told TNP that they’re “barely making ends meet”.

Despite the fact that the husband is making a 5-figure income every month.

If that was your reaction, you’re not the only one.

Here’s a breakdown from the article on the five-figure income family:

Family with five-figure monthly income unable to make end’s meet
Three kids, one in primary school, one in secondary school and one in a polytechnic.
Miss Lee just had a heart transplant and has to take immunosuppressants($50/pill)
$50 pill every day for the rest of her life
After insurance and financial support, medication still costs more than $1000 for 6 months
She has a maid
Her daughter’s sailing CCA costs between $300 and $400 a year.
Private tuition for her second daughter

Now you see why Singaporeans are flaming the article??

It got so bad even TNP, the guys who put up the story, took it down.

So there you are, thinking: oh well, something interesting to brighten up your day. Now back to work to really make ends meet.

But no, oh no, there’s more

While we Singaporeans are ready to forget the whole article and move on, well-known public intellectual and economist Donald Low decided to set the records straight.

And according to him, a five-figure monthly income is actually below average.

Here’s what he said in point form if you’re too lazy to read everything:

Family income (assuming it’s $11,000) is actually below S’pore average income of $12,000
Family income per capita (income per person in the household) is $2,200, far below S’pore average income per capita of $3,835
People will always think they’re poor according to researchers.
S’poreans only sympathise with imaginary middle-class families, but not real ones.
S’pore is a low-trust society, which could lead to not willing to pay higher taxes and thus, not having nice stuff.

Assuming the family earns $11,000, they’re actually below average, Low said

He argued that once people hear the magic words five-figure monthly income, they automatically think the family is rich.

But that’s not true.

According to the Department of Statistics Singapore, the average household income for 2017 was $12,000 and the median, $9,000.

And to drive the hammer home, the family has 5 members, so their income per capita (person) in the household comes up to about $2,200.

That’s so far below the average income per capita of $3,835 and median of $2,699.

People only empathise with the imaginary middle-class family

I’m pretty sure you empathise with families who are not poor enough to qualify for help from the government, and not rich enough to live comfortably.

We call these families those that fall within the cracks of society.

But when it’s time to put money where your mouth is, people will not want to help them.

Low theorised that people believed (wrongfully) that help from the government is a zero-sum game.

Meaning, the more middle-class families are helped by the government, there’ll be lesser help for lower-income families.

And that, is a sign of a low-trust society, according to him.

This leads to S’poreans not willing to pay higher taxes and thus, not having nice stuff.

So what happens after?

Well, for one, people will resist having to pay higher taxes (which is coming soon, love it or hate it).

Why? Because they don’t want the money to be transferred to other people.

So this means the government has lesser resources to provide essential services at subsidised rates for the people.

Key takeaway from Donald Low’s Facebook Post

In other words, update your database about what it means to have an average income in Singapore.

It’s earning $12,000 a month.

But you know what I think?

I think it simply means that the gap between the rich and the poor must be quite big.

Despite the income gap in 2017 being the lowest figure yet in years.

I mean, an average couple from local universities probably earns a combined income of $8,000.

That’s below the average household income right there, yo.

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This article was first published on goodyfeed.com