Average household incomes up, but rich-poor gap continues: report
By Satish Cheney, Channel NewsAsia | Posted: 12 February 2007 2353 hrs

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SINGAPORE: The average monthly household income from work for Singaporeans grew by 4.3 percent to $6,260 last year.

One reason for the growth was the sustained economic expansion.

But a Department of Statistics report also noted that the gap between the high and low income groups was continuing.

The report said the expanding economy and improving labour market had benefited all income groups.

Taking inflation into account, employed households enjoyed real income growth of 3.2 percent last year.

Among the lowest 10% of employed households, there was a strong pick-up even though individual wages among lower-income workers had generally remained stagnant.

This might be due to an increase in the number of working persons in the lower-income households.

Professor Chew Soon Beng, Professor of Economics at Nanyang Technological University, said: "During the recession, many household members in the low income group had quit the labour market. Now that the economy is doing very well, many of them, especially housewives, have rejoined the workforce and find gainful employment. That is good news. But I think the pay they get is relatively low."

Higher-income households saw faster income growth, reflecting higher wage increases for skilled workers.

But this was also causing the gap between the high and low income groups to continue.

Professor Chew said: "High-income executives in Singapore, their pay is determined by the pay of high-income executives in developed countries. The pay of low-income workers in Singapore is determined by the pay of similar workers in the developing countries. The Workfare is very important and also the government has to ensure the cost of living in Singapore remains affordable."

According to the Department of Statistics report, the government's policies such as the Progress Package, including the Workfare Bonus, have helped control the household income disparity. - CNA/ir