2044’s Singapore Dream is to aspire for More Than Survival [ft. RICE Media, NUS, @AinLovesCodes]

The Elusive Middle-Class: Navigating the Complexities of Income, Wealth, and Social Mobility

In this Alternative Budget Debate episode, our panel of experts dig deep into the multifaceted nature of the middle class in Singapore; social class, the role of humanities and social sciences, the Gini coefficient, government transfers, and the progressive tax system.

Our panel:

1. Khai, MD of RICE Media
2. Dr Tan En Ser, an appointed Justice of the Peace in 2013, author, and Associate Professor with IPS
3. Ainul, a tech influencer with insider knowledge on thriving careers in the tech industry

We set the stage by outlining traditional metrics like income, education, occupation, and housing that are used to measure class. From a sociology perspective, Dr Tan highlighted the significance of humanities and social sciences in the modern world. “It’s really quite hard to measure lower, middle, middle, upper middle,” Dr Tan conceded.

Other factors like wealth, social networks, and life experiences also contribute to one’s definition of class. Khai chimed in that the middle class plays a crucial role in society and wants to shed light on their experiences and aspirations.

Income and Wealth: Defining the Middle Class

“Income is a quick way to measure [class],” said Dr Tan. “The median household income in Singapore is about almost 11,000.”

However, Dr Tan cautioned that income alone is not sufficient to define the middle class. “Wealth is also important,” he said. “Some people may have zero income but still play golf and afford everything.”

Social Capital: The Importance of Networks

Beyond income and wealth, the panel discussed the role of social capital in defining the middle class. “Social capital means whether we have the context and the connection,” said Dr Tan.

“Connection does matter,” 
“You need a lot of what we call bridging social capital,”
“That means you bridge with other, other networks.”

The conversation shifted to recognising less tangible assets. Ain, pointed out: “It’s not just income and financial wealth. It’s also the social wealth that you have—networks, being able to leverage opportunities through your parents.” She brought an important perspective as someone who came from a non-university background but found success in tech. Dr Tan chimed in on the need for cognitive abilities and awareness in an era dominated by artificial intelligence. He emphasised that critical thinking, understanding the workplace, and market dynamics are crucial skills that can be imparted through these disciplines. While technical proficiency is important, the cognitive aspect of critical thinking holds great value in today’s knowledge economy.

The Gini Coefficient and Income Inequality:

Gini coefficient; a measure of income inequality. Dr Tan clarifies that it provides a quick snapshot of a country’s equality and is useful for comparative purposes. He mentions that Singapore’s coefficient, around 0.3, is comparable to countries like Australia and New Zealand. However, he notes that the Nordic countries have achieved even lower coefficients, around 0.2.

Singapore’s Gini coefficient was reported as 433 in 2023, but reduced to 371 after factoring in government transfers and taxes. 

Government Transfers and Taxation:

The discussion then shifted to the role of government transfers in reducing income inequality. Dr Tan explained that such transfers provide additional financial support to individuals who may not otherwise afford certain necessities. This system helps level the playing field and supports those at the bottom of the income spectrum. The panel agreed that a progressive tax system, which involves taxing the wealthy and redistributing funds, is the acceptable model for achieving socially constructed equality.

Balancing Work, Caregiving, and Personal Needs:

Ain, the tech influencer, shared her perspective on the challenges faced by mid-career workers, particularly in managing eldercare, childcare, and their own careers. The need for diversified approaches to support Singaporeans in these areas includes providing assistance for caregivers and implementing measures to support employees with caregiving duties. Additionally, subsidising childcare fees and exploring further funding options can alleviate the burden on working individuals.

Khai, a mid-career professional, described juggling eldercare, childcare and career demands as a reality for many. “There needs to be a balance…there’s clearly room for how we can disperse support in a more diversified approach.” When questioned about feeling the tax pinch, Khai acknowledged higher bills but advocated for more assistance with basic living costs.

The Impact of Tax Increases on different segments of society:

While acknowledging that some listeners and friends belonged to the upper middle or upper-class strata, the panel considered the importance of collective responsibility. Dr Tan asserts that a progressive tax system, which involves taxing the wealthy and redistributing wealth, aligns with societal expectations and helps combat inequality. They discussed the necessity of understanding the pain caused by tax increases and the potential benefits they can bring to society as a whole. 

The middle class in Singapore is a complex and dynamic group, defined by a combination of factors including income, wealth, social capital, and cultural capital. Social mobility remains a challenge, but bridging social capital and breaking out of silos can help individuals and communities move up the socioeconomic ladder. 

You can check their full interview on TFC Alternative Budget Debate, Episode 4 on Spotify, YouTube, Google podcast or Apple podcast for the candid discussion provided insightful perspective for policymakers seeking a balanced and equitable society for all. The panel also emphasised the importance of supporting working individuals in balancing caregiving responsibilities and personal needs. By exploring these topics, the conversation offered a comprehensive understanding of the challenges and opportunities that lie ahead for the middle class.

You may also be interested in our other Budget Debates on:
1. More on CPF Shielding, Skills Future and Property Tax
2. The Survival of Singapore’s Property Ladder
3. Is CPF a reliable partner for all Singaporeans?

Get a quick catch up on Singapore Budget 2024’s benefit-list and impact on:
1. Middle-aged Singaporeans
2. Married Singaporeans with 2 kids
3. Retirees
4. Single Individuals under 45

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