[OPINION] More can be done to protect those with insecure livelihoods, as illustrated by the social implications of the Covid-19 crisis.
Teo You Yenn is an Associate Professor and Provost's Chair in Sociology at Nanyang Technological University while Ng Kok Hoe is a Senior Research Fellow and Head of Case Study Unit at Lee Kuan Yew school of Public Policy.
Here, Teo and Ng write about how the Covid-19 crisis has illustrated the social implications of inequality, and why current aid measures might not be enough:
- The Covid-19 outbreak exacerbates social inequalities.
- Emergency measures have inherent limitations, and tend to be narrowly-focused and limited by time.
- Many low-wage workers have livelihoods which are insecure, which means they are unable to build up a buffer of savings for times of crisis.
- Now is the time to undertake longer-term structural changes in policy, to help low-wage workers prepare for future shocks.
This article first appeared on Academia.sg on Mar. 17.
By Teo You Yenn and Ng Kok Hoe
Since the onset of the coronavirus crisis in January this year, life has been lived in a state of suspended reality.
Plans have been shelved, daily habits altered, and the steady pursuit of tasks and goals has been replaced with a feeling of wait and see.
In the last few years, we and various collaborators and allies have been worried about the intertwined problems of poverty and inequality in Singapore.
On various fronts, we presented research and put forth our view that the problems are structural and not individual, and therefore to overcome them, major and long-term structural changes need to happen.
The emergence of a global health crisis pushes these problems into the backdrop, and the ever-evolving situation that alters everyone’s daily habits creates a feeling that we must overcome this first, before we return to our regular concerns.
Covid-19 has illustrated the implications of social inequality
Yet, the Covid-19 crisis powerfully illustrates the social implications of inequality and sheds light on gaps in the management of our economy and society.
The economic impact of the crisis has been deep and widespread.
Sectors like retail, tourism and transport have been hard hit. Jobs become at risk and small businesses worry about sustainability as revenues fall. In different ways, the disruption has reached all corners of society. But even the impact of such a large-scale crisis is unequal.
Some emergency measures tailored to the particular stresses of the current crisis are necessary. But emergency measures have inherent limitations. They tend to be narrowly focused and time-limited.
In Singapore, the preference for a trickle-down model of help premised on protecting businesses has also run into problems this time. We have seen how assistance given to landlords may not always reach shop tenants, and help given to transport operators may not reach all drivers equally.
The massive suspension of economic activity in the world now will have especially serious and far-reaching consequences for those people who before the crisis had already been barely making ends meet.
Low-wage workers have been among the hardest-hit
Among the hardest hit are low-wage workers whose livelihoods have always been insecure. Some of these jobs are in the gig economy, such as delivery and private car hire.
Other jobs are insecure because they do not offer regular or full hours. When the economy stalls, these jobs are quickly threatened as customers reduce their spending and employers look to cut costs.
The insecure nature of these jobs is largely the result of limited employment protection and regulation.
While this lowers the barriers to entry to some jobs and allows businesses to be more nimble when responding to fluctuations in demand, the flexibility has always come at the cost of workers’ income stability (in the short run) and, due to the lack of comprehensive old age income protection measures outside the CPF, retirement income security (in the long run).
The challenges of job insecurity are compounded by low wages. These workers and their households are often unable to build up substantial savings as a buffer against economic downturns, and the lives of their families can be thrown into disarray very quickly.
Without monetary buffers, suddenly reduced incomes can affect their ability to manage mortgage payments, children’s educational expenses, and other basic needs like healthcare and food.
For such people, short-term aid might not be enough
And with a social assistance regime that combines intensive gatekeeping with short-term and ungenerous aid, help can be too little, too late.
For some years, expenditure has consistently outpaced income for the bottom 20% of households in Singapore, calling into question the capacity of these households to build a buffer through savings. Chart generated from SingStat figures.
In response, various policy measures have been introduced and a second round of intervention is due shortly. Some emergency measures tailored to the particular stresses of the current crisis are necessary.
But emergency measures have inherent limitations. They tend to be narrowly focused and time-limited.
In Singapore, the preference for a trickle-down model of help premised on protecting businesses has also run into problems this time. We have seen how assistance given to landlords may not always reach shop tenants, and help given to transport operators may not reach all drivers equally.
A certain mentality needs to be addressed for more to be done
Can we do more? A rationalisation sometimes kicks in: In times of prosperity, people do not need help; in times of need, there are insufficient means to help.
This mindset encourages inertia and delays change. The problems that poorer households faced in normal times have not been suspended because of the crisis.
All the things that should have been done to help them then, now must be done.
The current crisis illuminates. It shows us where we most need to intervene to strengthen our social policies: Improving wage protection across all low-paying jobs, shoring up job security in new sectors of the economy, strengthening alternative retirement income sources, enhancing the social assistance regime, and extending the provision of public goods like care services.
In crisis, we may seek immediate relief that does not benefit society in the long run. We may be more willing to cede space, wait for instruction, and support the status quo.
But if we want our shared futures to be better, we cannot allow ourselves to live in suspended reality.
Pressing ahead with necessary structural reforms will put individuals in a better position to build up buffers against future shocks and reduce the resources required for drastic crisis measures. It will also dampen the disproportionate economic impact on more vulnerable people next time.
The existential threat of disease has made more obvious than ever that the well-being of people across the class spectrum are interconnected.
Indeed there have been many calls for mutual help and social unity. Addressing gaps in policy that leave parts of society behind would be a powerful expression of such unity.
There is much for us as citizens to do as well. In crisis, we may seek immediate relief that does not benefit society in the long run. We may be more willing to cede space, wait for instruction, and support the status quo.
But if we want our shared futures to be better, we cannot allow ourselves to live in suspended reality. We must aspire to more, we owe future generations more.
The authors have also led research on Minimum Income Standards in Singapore.
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Top image collage left photo by Ashley Tan, right photo from SBS Transit Ltd Facebook