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Strong Eagle
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Postby Strong Eagle » Fri, 13 Sep 2013 12:32 am

Wd40 wrote:The free market thing is interesting. What it means is businesses that are of low margin will just disappear, if they cannot pass on the cost to the customer. Already lots of kinds of industries are unviable in Singapore and stuff needs to be imported. As rents increase, we will only have the highest of margins business survive in Singapore, like the RollsRoyce manufacturing.

But restaurants are something that cannot dissappear from Singapore totally. I think in future you will have restaurants cost here in line with the UK for example and people will start cooking at home, after all.


What it means is that one small class of people reap windfall benefits at the expense of all others. It is not a free market when there is a scarcity of the desired resource. It becomes a market of "rents" (wherein the amounts charged far exceed the costs of production - Apple iPhone is an example but people do this willingly).

When there is scarcity of resources, then there are only two solutions. The first is to engage the so called "free market" where only the rich have access to the product or service". Nothing really "free" about a market where only a small percentage of the population can participate.

The second is for government to control the "commons", an economic practice that goes back to Anglo Saxon law. Scarce resources are shared, have limits placed upon them.

The Singapore government has screwed up. By permitting virtually unlimited foreign investment in real estate, prices have shot through the roof, notwithstanding the feeble efforts at control such as no HDB, shop houses, or first story ownership.

And who has benefited? A small percentage of property owners who have become extremely rich as the result of a run up in prices. And the banks who finance them. Everyone else, from the renter, the shop owner, and the restauranteur has been screwed.

There was (and is) no need for this kind of property price run up, except that the government caved to foreign speculators, while ignoring the needs of the greater population.

Average SG income of $40,000 per year and a $300,000 minimal HDB flat? It doesn't work... things are only going to get much worse.

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Postby Strong Eagle » Fri, 13 Sep 2013 12:35 am

PNGMK wrote:I'm becoming convinced that we are on the tip of a new trend of high end expats moving in again.

I've met quite a few recently. Companies (and individuals) still prefer Singapore to almost anywhere else in both Oceania and Asia.


I don't know about that. Whereas before it was possible to bring middle management people to Singapore for a reasonable amount of money, high rents, high school tuition, high transportation costs have made many companies look elsewhere, particularly Malaysia (KL, Penang). To bring an $80K employee from the USA means adding another $36-40K for housing, an equal or larger amount for school, and the same or more for a car.

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Postby AngMoG » Fri, 13 Sep 2013 10:36 am

Strong Eagle wrote:
PNGMK wrote:I'm becoming convinced that we are on the tip of a new trend of high end expats moving in again.

I've met quite a few recently. Companies (and individuals) still prefer Singapore to almost anywhere else in both Oceania and Asia.


I don't know about that. Whereas before it was possible to bring middle management people to Singapore for a reasonable amount of money, high rents, high school tuition, high transportation costs have made many companies look elsewhere, particularly Malaysia (KL, Penang). To bring an $80K employee from the USA means adding another $36-40K for housing, an equal or larger amount for school, and the same or more for a car.


My 2 cents on this: Singapore is still a good location for the (regional) top management (plus whoever needs to directly support them locally) due to the high standards of living, and the fact that if you pay somebody half a million dollars, it does not matter much if you add another 100-200K for expenses; if the company actually has a business in Singapore, add to that those who need to do the "local work" (sales, business analysts, relationship managers, guards, etc.).

Backoffice middle management, however, will likely move out together with the backoffice positions themselves, to a more "cost effective" location. I can see that happening in my company already. If you have a medium- to large-sized company, and looking at the bottom line, it just makes sense.

But even for the top management - if the company does not run much of a business in Singapore itself, there are a few locations in the region that are starting to compete with Singapore. One is obviously Hong Kong - same prices, but better access to the Chinese market and clearer work visa policies. Another is shaping up to be KL, it seems: a lot cheaper, liberal work visa policies, and almost the same geographical advantages of Singapore.

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Postby Wd40 » Fri, 13 Sep 2013 10:43 am

In my company its a slow death kind of process. No new hiring happens in Singapore, it happens in a low cost location. There are no replacement hires. Anyone who quits gets replaced in a low cost location. Currently they are not forcing anyone to quit, may be in a few departments there is pressure on contractors being let off, but employees are safe at the moment. The next year though, the target is to move another 30% staff to a low cost location. So this will be a slow and boring wind down.

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Postby ScoobyDoes » Fri, 13 Sep 2013 10:49 am

PNGMK wrote:I'm becoming convinced that we are on the tip of a new trend of high end expats moving in again.

I've met quite a few recently. Companies (and individuals) still prefer Singapore to almost anywhere else in both Oceania and Asia.



I've met a few guys shipping up and moving to Shanghai.

Also, there are many more foreigners in JB now than there used to be.

We'll always hear stories about people moving from here to there and any other place for whatever reasons. When my previous company moved me from KL to here, it was a mistake on several fronts but here now and making the best out of it we can, which gets harder to justify with every rental increase.
'When Lewis Hamilton wins a race he has to thank Vodafone whereas in my day I used to chase the crumpet. I know which era I'd rather race in.'

SIR Stirling Moss OBE

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Postby zzm9980 » Fri, 13 Sep 2013 3:46 pm

ScoobyDoes wrote:
PNGMK wrote:I'm becoming convinced that we are on the tip of a new trend of high end expats moving in again.

I've met quite a few recently. Companies (and individuals) still prefer Singapore to almost anywhere else in both Oceania and Asia.



I've met a few guys shipping up and moving to Shanghai.


The writing is on the wall at my company for this too. Certain extremely important infrastructure has been shifted out of Singapore and to Hong Kong. A very large office campus has been built in Shanghai. More business is happening in China. Our largest market will be China very soon (of not already, I don't keep up with that).

An expat can have almost the same quality of life or better in Shanghai than Singapore, with a preferable climate for most westerners.

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Postby Mi Amigo » Fri, 13 Sep 2013 4:43 pm

I suspect that some of the larger corporations wanted to see how things went in the decade or so following the HK handover, and during that time having an operation in Singapore was a good 'hedge'. And previously the costs were of course lower here than HK, but that's not the case any more. So I can see more companies moving large parts of their infrastructure to HK and Shanghai, plus the lower cost locations for back office functions of course. I don't think Singapore will necessarily collapse, as it still has its attractions, but I do feel that the old man's 'recipe' has been well and truly broken now, so there could be some challening years ahead.

For the truly HNW folks, it can be the Monaco of Asia, but is that enough to support the local economy and the aspirations of the newly vocal populace?
Be careful what you wish for

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Postby PNGMK » Fri, 13 Sep 2013 6:54 pm

Strong Eagle wrote:
PNGMK wrote:I'm becoming convinced that we are on the tip of a new trend of high end expats moving in again.

I've met quite a few recently. Companies (and individuals) still prefer Singapore to almost anywhere else in both Oceania and Asia.


I don't know about that. Whereas before it was possible to bring middle management people to Singapore for a reasonable amount of money, high rents, high school tuition, high transportation costs have made many companies look elsewhere, particularly Malaysia (KL, Penang). To bring an $80K employee from the USA means adding another $36-40K for housing, an equal or larger amount for school, and the same or more for a car.


$80k is not what I was thinking of. I'm talking about VP level upwards who rent houses that cost a minimum of $16,000 per month. THAT's who is moving here.

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Postby PNGMK » Fri, 13 Sep 2013 6:56 pm

AngMoG wrote:
Strong Eagle wrote:
PNGMK wrote:I'm becoming convinced that we are on the tip of a new trend of high end expats moving in again.

I've met quite a few recently. Companies (and individuals) still prefer Singapore to almost anywhere else in both Oceania and Asia.


I don't know about that. Whereas before it was possible to bring middle management people to Singapore for a reasonable amount of money, high rents, high school tuition, high transportation costs have made many companies look elsewhere, particularly Malaysia (KL, Penang). To bring an $80K employee from the USA means adding another $36-40K for housing, an equal or larger amount for school, and the same or more for a car.


My 2 cents on this: Singapore is still a good location for the (regional) top management (plus whoever needs to directly support them locally) due to the high standards of living, and the fact that if you pay somebody half a million dollars, it does not matter much if you add another 100-200K for expenses; if the company actually has a business in Singapore, add to that those who need to do the "local work" (sales, business analysts, relationship managers, guards, etc.).

Backoffice middle management, however, will likely move out together with the backoffice positions themselves, to a more "cost effective" location. I can see that happening in my company already. If you have a medium- to large-sized company, and looking at the bottom line, it just makes sense.

But even for the top management - if the company does not run much of a business in Singapore itself, there are a few locations in the region that are starting to compete with Singapore. One is obviously Hong Kong - same prices, but better access to the Chinese market and clearer work visa policies. Another is shaping up to be KL, it seems: a lot cheaper, liberal work visa policies, and almost the same geographical advantages of Singapore.


KL will screw it up via Islamic Fundamentalism and crime. Already people are leaving there.

HK has pollution issues.

The people I'm talking about are like me; responsible for NZ to Africa. We either live in Singapore or Dubai/UAE. Nothing in between.

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Postby chaaraard » Sat, 14 Sep 2013 5:12 pm

I believe Singapore is good because of governance, if there's something wrong, we can fix it quickly more so than other states.

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Postby Strong Eagle » Sat, 14 Sep 2013 9:45 pm

PNGMK wrote:
Strong Eagle wrote:
PNGMK wrote:I'm becoming convinced that we are on the tip of a new trend of high end expats moving in again.

I've met quite a few recently. Companies (and individuals) still prefer Singapore to almost anywhere else in both Oceania and Asia.


I don't know about that. Whereas before it was possible to bring middle management people to Singapore for a reasonable amount of money, high rents, high school tuition, high transportation costs have made many companies look elsewhere, particularly Malaysia (KL, Penang). To bring an $80K employee from the USA means adding another $36-40K for housing, an equal or larger amount for school, and the same or more for a car.


$80k is not what I was thinking of. I'm talking about VP level upwards who rent houses that cost a minimum of $16,000 per month. THAT's who is moving here.


Even these folks are going to be fewer and farther between. If you can't run you core business from Singapore because of excessive costs and overly restrictive work permits, and the support staff (other than local) is also costly, then there is no reason to have a senior exec in Singapore.

I've already seen multiple service companies move their execs out of Singapore to where the majority of service staff is located. It is my sense that other MNC's are looking at doing the same thing, as an attrition type event. Senior execs, climbing the corporate ladder in search of the golden fleece, will live where they are told to live.

When Singapore's cost of living becomes the same as Hong Kong, why would you choose Singapore, except maybe for the pollution in HK.

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Postby zzm9980 » Sat, 14 Sep 2013 10:07 pm

Strong Eagle wrote:When Singapore's cost of living becomes the same as Hong Kong, why would you choose Singapore, except maybe for the pollution in HK.


Pollution in HK is overhyped anyway. Especially if June's smog starts become a seasonal occurrence.

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Postby PNGMK » Sat, 14 Sep 2013 11:04 pm

Strong Eagle wrote:
PNGMK wrote:
Strong Eagle wrote:
PNGMK wrote:I'm becoming convinced that we are on the tip of a new trend of high end expats moving in again.

I've met quite a few recently. Companies (and individuals) still prefer Singapore to almost anywhere else in both Oceania and Asia.


I don't know about that. Whereas before it was possible to bring middle management people to Singapore for a reasonable amount of money, high rents, high school tuition, high transportation costs have made many companies look elsewhere, particularly Malaysia (KL, Penang). To bring an $80K employee from the USA means adding another $36-40K for housing, an equal or larger amount for school, and the same or more for a car.


$80k is not what I was thinking of. I'm talking about VP level upwards who rent houses that cost a minimum of $16,000 per month. THAT's who is moving here.


Even these folks are going to be fewer and farther between. If you can't run you core business from Singapore because of excessive costs and overly restrictive work permits, and the support staff (other than local) is also costly, then there is no reason to have a senior exec in Singapore.

I've already seen multiple service companies move their execs out of Singapore to where the majority of service staff is located. It is my sense that other MNC's are looking at doing the same thing, as an attrition type event. Senior execs, climbing the corporate ladder in search of the golden fleece, will live where they are told to live.

When Singapore's cost of living becomes the same as Hong Kong, why would you choose Singapore, except maybe for the pollution in HK.


I tell you - I'm seeing it. I don't know the drivers for their reasons but we aren't their strata of society and hence it's hard to guess why they are making this decision.

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Postby Wd40 » Sun, 15 Sep 2013 12:56 am

I agree a bit with PNGMK. People at 80K USD are not the ones that make huge impacts for organizations, these people can be easily hired at local packages. Its the senior execs that get all the bells and whistles expat packages.

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Postby zzm9980 » Sun, 15 Sep 2013 7:36 am

Wd40 wrote:I agree a bit with PNGMK. People at 80K USD are not the ones that make huge impacts for organizations, these people can be easily hired at local packages. Its the senior execs that get all the bells and whistles expat packages.


I take it you're not responsible for hiring, interviewing, or your definition of "easy" in this context doesn't assume the person you're hiring is qualified.


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