An
evaluation of the effectiveness of using education as a solution to reduce
income inequality within Singapore
In
Goldin’s (2009) lecture, he mentions several problems that are rising due to
globalisation, one of which is that “globalisation is not inclusive” and many
people are left out of its benefits, resulting in income inequality. Income
inequality is the difference in wealth between households. A large income gap
within households indicates that there is a large difference in income between
the rich and poor families. This is undesirable as it would cause an unstable
society. Statistics have shown that people in developed countries have more
capability and knowledge to reap more benefits from globalisation than those in
less developed countries. This is supported by Ogunsola (2005), who acknowledged
that “the more developed countries reap the lion share of the benefits while
the less developed bypass the benefits” of globalisation. However, income
inequality can also exist within countries. This can be seen in the case of
Singapore. Although Singapore is ranked as one of the top countries for the
highest GDP per capita, it has a significantly high Gini coefficient of 0.463
as of 2013, indicating that large income inequality exists within Singapore.
To
address the problem on large income inequality, the education of citizens is
adopted by Singapore government as one of the strategies. Education is also a
globally recognised tool that can benefit and allow people to escape the
poverty trap. For example UNESCO (2014) which recognises education as a
solution to alleviate poverty adopted a mission called “Education for All” to
promote education.
I
feel that equipping the younger generations with higher level of education is
an effective tool that can help to reduce income inequality between households
in Singapore in the long run. The importance of education to reduce income
inequality can be seen easily by comparing the difference in the income level
between different people with different education levels. Davie (2012)
mentioned that starting salaries of diploma holders in Singapore are estimated
to be around $2000 while those of degree holders are $3000. It can be said that
people without these qualifications will not be able to reach salaries of those
stated. Qualification represents knowledge and capability in this society and
individuals who are highly educated will more likely be highly sought for by
the knowledge based economy as compared to the people who have lower level of
education. This shows that as long
as the poor are educated and have the required knowledge, they will be able to
have the opportunity to leave the poverty trap and reduce the income inequality
within Singapore.
In
addition, Ji (2012) did an analysis on the education policies of countries
including Japan and Korea which place a strong emphasis on equity in terms of opportunities
for education. She mentioned that education policies focusing on ensuring availability
of equal education for all might be a particularly useful way for countries to
increase earning mobility between generations and reduce income inequality over
time. Singapore, similar to Japan and Korea, also focuses on equity in education
in terms of providing opportunities for all the individuals in Singapore. For
example, all Singaporean are required to have compulsory primary education. To
ensure that no families are denied of this opportunity, education for
Singaporean students is subsidised for the needy families and every student is
given a sum of money in their Edusave account annually. In addition, many
different educational paths are available for the children after their primary
school education to encourage the less academically inclined students to
further their studies. For example, besides the conventional schools, Singapore
also set up sports schools and School Of The Arts (SOTA) to encourage the
students who do not do well to continue with their studies to develop their
potential and pursuit their area of interest. The Singapore’s education policy
is directed in such a way that the newer generations have equal opportunities
in attaining at least primary school education. In addition, individuals also
are encouraged to study beyond primary school. These will create a future
workforce that has a higher level of education. It is believed that having
highly educated workforce, the income inequality in Singapore will be reduced gradually.
The
limitation of using education as a tool is that it requires a long time for the
effects to be observed. Furthermore, it is impossible to eliminate income
inequality in reality. I believe that income inequality can be reduced when the
education level of the entire workforce increase as a whole. However this is a
long process that requires decades to achieve this. This can be supported by
the statistics from the Ministry of Manpower in Singapore (2013) which revealed
through a span of 10 years from 2003 to 2013, the percentage of workforce that attained
tertiary education increased by about 15%. This suggest that it still requires
a long time for Singapore to obtain an even higher percentage of tertiary
educated worker.
Currently,
a phenomenon observed in Singapore’s society is that as the Singapore’s
workforce gets more opportunity for education, the income gap increases. Statistics
from the Ministry of Manpower of Singapore (2013) revealed that 49.9% of the
workforce possessed tertiary education in 2013 as compared to 34.6% in 2003.
However, within this same period, the Singapore Department of Statistics (2013)
indicated that the Gini coefficient increased from 0.457 to 0.463. As the new
generation of young individuals with higher qualification enters the work force
and obtain a relatively higher salary than the lesser educated, it can be
expected that the income inequality is going to further increase. This effect
is further worsen when lower educated foreigner who demands lesser pay enter
our workforce and push down the lower income bracket.
To
alleviate such limitation, the government can adopt strategies like promoting
further education for the less educated individuals who are already in the
workforce. By doing this, each individual may become more specialised in doing their
work, which can allow them to demand for higher salary. Educating this group of
less educated workforce may also makes them more irreplaceable as compared to
the foreigners who do not have that particular skill. By doing this, we will be
able to increase or at least maintain the salary of this group of workforce who
tend to have relatively lower income due to their lower education.
Sir Francis
Bacon once said “Knowledge is power”. Education and knowledge are now one of
the crucial keys to success and wealth in the Singapore society. I believe that
education will be an effective tool to reduce income inequality in the long run
when majority of the people have attained higher qualifications or knowledge in
their specialisation. However, due to the different professions that exist and
the different professions will be rewarded differently in terms of salary
within the society, income inequality never be eliminated. But I feel that
income inequality is not a major problem as long as most of the people have
enough salary to earn a living.
References
Davie, S. (2013, May 18).
Is a degree really all-important?. The
Straits Times. Retrieved March 25, 2014 from http://www.straitstimes.com/the-big-story/case-you-missed-it/story/degree-really-all-important-20130518
Department of Statistic
Singapore. (2013). Key Household Income Trends, 2013. Retrieved March 25, 2014
from http://www.singstat.gov.sg/publications/publications_and_papers/household_income_and_expenditure/pp-s20.pdf.
Goldin, I.
(2009, July). Navigating our global future [Video file]. Retrieved March 25, 2014 from http://www.ted.com/talks/lang/en/ian_goldin_navigating_our_global_future.html
Ji, E. C. (2012, April
25). How can education help tackle rising income inequality?. Retrieved March
25, 2014 from http://oecdeducationtoday.blogspot.sg/2012/04/how-can-education-help-tackle-rising.html?m=1.
Ministry of Manpower Singapore. (2012). Singapore Workforce, 2012.
Retrieved March 25, 2014 from http://www.mom.gov.sg/Publications/mrsd_singapore_workforce_2012.pdf
Ministry of Manpower Singapore. (2013). Labour Force in Singapore, 2013.
Retrieved March 25, 2014 from http://stats.mom.gov.sg/iMAS_PdfLibrary/mrsd_2013LabourForce.pdf#page=21
Ogunsola, L. A. (2005). Information and Communication Technologies and the Effects
of Globalization: Twenty-First Century "Digital Slavery" for
Developing Countries--Myth or Reality?.
Retrieved from March 25, 2014,
from Obafemi Awolowo
University, http://southernlibrarianship.icaap.org/content/v06n01/ogunsola_l01.htm
UNESCO. (2014). Education for the
21st Century.
Retrieved March 25, 2014 from
http://en.unesco.org/themes/education-21st-century.
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