The case for giving Singapore workers a stake in the companies they help build

Rising incomes have not closed the wealth divide. Employee ownership and profit-sharing may offer new opportunities for inclusive growth.

- Wilson Goh and Wong Kang Li

When the local supermarket chain Sheng Siong posts record earnings, its success is felt far beyond the boardroom.

A significant portion of its profits is shared with its staff, boosting the take-home pay of cashiers and store assistants.

Some of Singapore's blue-chip companies, such as DBS, have also used employee share plans to give staff a stake in the firm alongside their salaries.

These practices hint at a bigger possibility in Singapore: What if more workers had a direct share in the business they help to build besides just collecting a wage?

That question is worth considering as we look to address one sobering reality in the latest paper on income growth, inequality and social mobility released by the Ministry of Finance (MOF) in February.

Real household incomes have risen across the board, and income inequality has inched down to its lowest level in decades. But wealth remains far more concentrated than income, with a large share of household assets held by a small slice at the top.

At the May Day Rally, Prime Minister and Minister for Finance Lawrence Wong struck a note of "quiet confidence", pledging that while "we may not be able to protect every job, we will protect every worker".

If the last 60 years were about turning workers into home owners, the next 60 years may have to focus on something harder, which is to help more Singaporeans become co-owners of the economic pie itself.

Singapore's "asset-based welfare" model leans heavily on two pillars: public housing, which has given most citizens a substantial asset, and the Central Provident Fund (CPF) system, which compels disciplined saving for retirement and home ownership. Both underpin social mobility and resilience.