Progressive Wage Model to cover up to 80,000 retail, food services workers, possibly in 2 to 3 years

• The Progressive Wage Model (PWM) will be extended to the retail and food services sectors, benefiting up to 80,000 workers
• The roll-out could take two to three years 
• The PWM now covers around 85,000 cleaning, security and landscaping workers
• The Government is studying how to extend the PWM to those in similar roles but are in sectors not covered by the model

SINGAPORE — The Progressive Wage Model (PWM) will be expanded to lift the wages of up to 80,000 local workers in the food services and retail sectors, Senior Minister of State for Manpower Zaqy Mohamad announced in Parliament on Wednesday (March 3).

Speaking during the debate on his ministry’s budget, Mr Zaqy said that these sectors have some of the largest numbers of lower-wage workers in Singapore.

Mr Zaqy said that the extension of the PWM — a framework where wages are pegged to skills, productivity and career development — has been studied for some time. 

He previously said that the Government would extend the model to more sectors when business conditions were more favourable.

The PWM roll-out for the two sectors could take two to three years.

Cluster committees comprising unions, employers and the Government have been established to make recommendations on its schedule and implementation by the end of this year, Mr Zaqy said.

The PWM was introduced in 2012 as a way to allow wages to rise along with skills and productivity improvements.

Right now, the PWMs for the cleaning, security and landscaping sectors cover about 85,000 workers.

It will be compulsory for workers in the lift and escalator maintenance sector next year. 

Altogether, there will be around 218,000 workers covered by the model when it is rolled out to the retail and food services sectors. 

Under the model, the median monthly wage of cleaners has seen cumulative real growth (adjusted for inflation) of 37 per cent since 2013 to reach S$1,388 in 2019. For security officers, there was a cumulative real growth of 29 per cent in wages since 2015 to S$2,391 in 2019.

Mr Zaqy said: “We are confident that our local workers in the food services and retail sectors will likewise see a meaningful uplift to their wages in time to come.” 

Citing the security sector as an example, Mr Zaqy said: “Besides improved working conditions, many of us have witnessed the transformation of roles in the sector — from ‘jagas’ (watchmen) who perform largely caretaking functions to security officers who are skilled professionals, enabled by technology.”

Around 6 per cent more locals also joined the security sector yearly between 2015 and this year.

The PWM’s sectoral approach has, however, drawn criticism that some low-wage workers are not covered because they were employed by other sectors. For example, hotels also employ staff members in cleaning, security or landscaping roles.

On Tuesday, Dr Koh Poh Koon, deputy secretary-general of the National Trades Union Congress, called on the Government to roll out “vocational PWMs” to cover such lower-wage workers as well as those in jobs cutting across sectors such as clerks and logistics drivers.

Mr Gerald Giam, a Workers’ Party Member of Parliament with Aljunied Group Representation Constituency, also urged an extension of the PWM to these vocational workers.

Acknowledging that this is an issue, Mr Zaqy said the Government would consult key sectors on how to extend the PWM to around 50,000 of these workers.

Apart from the PWM, Mr Zaqy said that other measures to supplement the incomes of lower-wage workers already cast a wide net, covering full-time and part-time workers and the self-employed.

These include the Workfare Income Supplement scheme introduced in 2007. It supplements wages of workers by up to 30 per cent, depending on their incomes and ages.

Last year, about 440,000 people were eligible for Workfare payouts. 

The Government also doled out a one-off S$3,000 Workfare Special Payment to around half a million Singaporeans. 

Mr Zaqy said: “Keeping our lower-wage workers employed must continue to be our highest priority… (With this) in mind, we should take careful steps to raise the wages of lower-wage workers.”