Government determined to increase population to 7 mil in 2030.

[specuvestor]

specuvestor, it's true that we become subordinates. But, it's a higher level subordinates. Ang mo takes the top of food chain, we take middle, other developing countries become bottom feeder.

At least, we are better off with MNC.

I actually agree with you. The MNC model has worked very well in the past 50 years to bring us where we are today. 50 years ago the govt had to think of the fastest way to up employment for the 2m people who chose to be Singaporeans, of which 500k would be jobless when the British leaves. It was like China in the last decade: objective was not quality, it was quantity of jobs. As time went by we upgraded our labour force to whatever the MNCs required and improved the quality and value chain through investing in our people, primarily through education.

But it has its side effects: Singapore Chinese are probably the most un-entrepreneurial Chinese on the planet. Singaporeans' dream is to be CEO. Taiwanese don't even bother to interview CEOs, they look up to the chairman who is usually the founder. Most Singaporeans don't even know what is the purpose of Chairman.

But back to the topic: the question was whether FT increase the quality of our labour force. There are certainly some spillover effects, but I would think that is to much lesser extent than what academics or govt thinks (or maybe misrepresent) due to this MNC mentality. Those on the top are not transferring their skill set downwards. The challenge is how do you coerce that in formulating policies? FT are certainly useful to plug the capabilities gap, but it is highly debatable if their quality is significantly better than those areas which we have developed skills in.

[safetyfirst]

Some forumners here seem to suggest that population must grow for the economy to grow, so that there will be jobs.

China has the largest population, why is the size of its economy only one-third of the USA?

If economy stays the same size while working population drop, wont jobs be more readily available since our children have fewer competitors?

[Ben]

China has the largest population, why is the size of its economy only one-third of the USA?

There are already many economists predicting that China economy will overtake US in x number of years (can’t remember when). China is a developing nation while US is a developed nation for many years already. The rise in China is to a large extend due to its huge population.

If economy stays the same size while working population drop, wont jobs be more readily available since our children have fewer competitors?

I don’t see how the economy can stays the same if working population drop. It is interrelated. Maybe I am wrong, but to me having the same level of economy with lower level of population is like saying eating half a meal and expect to fill the stomach like a full meal. It is okay to be selective, for example, to eat more meat or fish instead of just rice or bread, but a certain level quantity of food is necessary to fill the stomach. Of course others can argue that we can try to lose weight and get use to eating less, but is that what we want here?

[d.o.g.]

There is an interesting clue hidden in the government's clarion call for a larger population. It is not about the economy. It is about CPF.

The government has been insisting for many years that the CPF system ensures we have enough for retirement. If this is the case, why does it keep saying that there will be fewer workers to "support" each elderly person and therefore we need more people? The fundamental concept of CPF is that each of us funds our own retirement and is not dependent on our children (or the rest of society) to support us. So the number of workers in future is totally irrelevant to our retirement lifestyle.

This concept of "needing young people to support old people" holds true if you operate a pay-as-you-go pension system like Social Security in the US, where today's workers fund today's retirees, and when today's workers retire in future they are supported by future workers.

But in Singapore there is no pension for the vast majority of people - they only have CPF which comes from their own salary throughout their working life. So if CPF is adequate there is no need for an increasing population. Even a declining population is fine because the old are living off their savings, they are not living off the tax payments of the young.

You cannot have it both ways. Either the CPF is inadequate and therefore Singapore requires Ponzi demographics (more and more young people needed to pay for the old) or the CPF is enough and the size of Singapore's future population is irrelevant.

So which part of the government is correct - the one that says we need more population, or the one that says CPF is enough? They cannot both be right.

Just my $0.02. As usual, YMMV.

[Temperament]

Brilliant logic!
What did Abraham Lincoln said?
"You can't fool all of the people all of the time"

[sgd]

As what I say if you look earlier at my comments ala Japanese government running out of pension funds maybe this is really all about cpf and nothing else.

The need for population growth could be a misdirection, a smokescreen by miw to make us look at the wrong ball when people should really be asking questions relevant to cpf instead.

We have never been a welfare state so suddenly they are saying the young have to support the old in time what the heck is that? where and how do they support this argument from?

I'm glad somebody here shares my view

[arthur]

There is an interesting clue hidden in the government's clarion call for a larger population. It is not about the economy. It is about CPF.

The government has been insisting for many years that the CPF system ensures we have enough for retirement. If this is the case, why does it keep saying that there will be fewer workers to "support" each elderly person and therefore we need more people? The fundamental concept of CPF is that each of us funds our own retirement and is not dependent on our children (or the rest of society) to support us. So the number of workers in future is totally irrelevant to our retirement lifestyle.

This concept of "needing young people to support old people" holds true if you operate a pay-as-you-go pension system like Social Security in the US, where today's workers fund today's retirees, and when today's workers retire in future they are supported by future workers.

But in Singapore there is no pension for the vast majority of people - they only have CPF which comes from their own salary throughout their working life. So if CPF is adequate there is no need for an increasing population. Even a declining population is fine because the old are living off their savings, they are not living off the tax payments of the young.

You cannot have it both ways. Either the CPF is inadequate and therefore Singapore requires Ponzi demographics (more and more young people needed to pay for the old) or the CPF is enough and the size of Singapore's future population is irrelevant.

So which part of the government is correct - the one that says we need more population, or the one that says CPF is enough? They cannot both be right.

Just my $0.02. As usual, YMMV.

Unfortunately, we may never know the answer until the day the answer is revealed. I hope the answer is a positive one that CPF is enough.

Otherwise, how can we comprehend the social ramifications?

[Bibi]

The government has been insisting for many years that the CPF system ensures we have enough for retirement. If this is the case, why does it keep saying that there will be fewer workers to "support" each elderly person and therefore we need more people?

The day when pap fielded strong man Tony Tan to run for president i already told my wife i suspect there is not much in our reserves. This is just my gut feel and i have no numbers to support it.

One case where we need more workers to support elderly could be due to future medical claims. Imagine lots of old people and few young chaps, the medical claims by the old will surely be enormous. And insurance premium will up by a hefty amount. I think govt is unwilling to use reserves to support old people. Or maybe there isnt much reserves in the first place.

[Share Investor]

Gov may have initially thought that CPF will be enough for retirement but gradually they are realizing that it is not the case with people living longer life and inflation.

Furthermore, people used their CPF for housing which is a non income producing asset thus leaving lesser for retirement.

At the end of the day, the amount drawn out for retirement is defintely inadequate for retirement. In the event that burden of caring for an aging population fall on the gov, the burden will be great if not supported by a sufficiently large economically active population.

[specuvestor]

IMHO d.o.g. is both right and wrong.

Right in that CPF is insufficient for a comfortable retirement. At current minimum sum of $139k, people will be getting $700-800 monthly payouts. So depends on what you think is "enough". And people complain the minimum sum figure is too high. If you understand the maths it is therefore not difficult to understand why US pay-as-you-go system is the real ponzi as you will need more and more people to support the thousand $ payout and they know mathematically social security would be bankrupt around 2035, unless the govt steps in (see below).

Wrong as in assuming CPF is enough but a kind of "ponzi". CPF is denominated in S$ and govt has the ability to print S$. This is very different from our foreign reserves, though related. We need the reserves to buy foreign goods and services but CPF will NEVER default on S$ liabilities, but we will starve cause we can't import say thai rice if we don't have foreign currencies to pay for it. The printing of course will not be free: it will be shared by the populace in terms of reduced purchasing power and inflation tax. To put it to the extreme, Zimbabwe will never default on its domestic bonds, question is whether you want their bonds at 1bio % (no typo) inflation a day. Default of domestic quasi-govt liabilities is red herring; similarly if we get cheap devalued S$ in future for retirement, I doubt we will be happy that CPF system is solvent.

The "ponzi" is that we need more and more people to sustain a GDP growth that is fueled by perspiration, ie population growth. Like I said what is needed is to separate this from the actual replacement requirement if we assume base case of GDP growth at zero next 20 years.