Graduate Digest
Bridging The Gap

Income inequality threatens to become a serious problem for Singapore. Explore how dire the situation is and what more can be done to tackle the issue here.

How bad exactly is the income inequality in Singapore? Due to the lack of data, accurate measurements of inequality and poverty are hard to come by. Income inequality is commonly expressed by the Gini coefficient, which is the ratio of the highest to lowest incomes in a society and expressed as a number between zero and one. 
 
Singapore’s Gini coefficient has risen fairly quickly over the last 20 years, and has hovered for some time above 0.4, the level that the UN-Habitat describes as “the international alert line for income inequality”. That said, the number dipped to 0.458 in 2016, its lowest level in a decade.
 
According to the Central Intelligence Agency’s “The World Factbook Country Comparison: Distribution of Family Income-Gini Index”, Singapore is ranked among the most unequal countries among wealthy nations, coming second only after Hong Kong. Yet the Gini coefficient cannot be directly compared across countries, as there is no international standard for its calculation. The number of people considered poor in Singapore is also hard to determine because there is no official poverty line. 
 
What is clear is that incomes of the less well-off are growing at a slower rate than their wealthier counterparts. The bottom 50 per cent of Singapore households saw their real incomes grow by between 2.1 per cent and 3.6 per cent for each household member last year, a Department of Statistics report released in February showed. This compares to an increase of between 3.7 per cent and 4.5 per cent for the next 40 per cent of households.
 
Read more about the nation's income inequality here.




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