Singapore families dismayed over rising inequality as inflation barely dents luxury home sales

Soaring inflation, growing rich-poor divide and declining social mobility have left middle-class families feeling the squeeze

Those less well-off may have to dip into their savings and cut discretionary spending, analysts note, even as government moves to address wealth gap

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Singapore’s core inflation gauge climbed to the highest level in almost 14 years in July. Photo: EPA-EFE

Published: 8:30am, 4 Sep 2022Updated: 2:51pm, 4 Sep 2022

Jason Guan, 39, is a business development manager in the fintech industry in Singapore. With an average monthly household income of around S$12,500 (US$9,000), his family is reasonably comfortable – the national median household income last year was S$9,520.

But as disruptions from the Ukraine war leave Asian countries including Singapore grappling with soaring inflation, the cost of living has left even a middle-class family like Guan’s feeling the squeeze.

Singapore’s core inflation gauge, which excludes accommodation and private transport, climbed to the highest level in almost 14 years in July. Some observers have suggested a global recession cannot be ruled out in 2023.

Diners at a restaurant at Cuppage Terrace in Singapore. Some middle-class families have started cutting down on dining out and other discretionary spending to save on expenses. Photo: Bloomberg

Guan’s family has begun tightening the purse strings by largely staying home during weekends instead of dining out like they used to. This leaves them savings of about S$2,000 a month, he says.

Prime Minister Lee Hsien Loong’s administration in June unveiled a S$1.5 billion “support package” to partially shield lower-income Singaporeans from price rises. “If the situation worsens, we stand ready to do more,” Lee said last month.

For middle-class Singapore, the gnawing pain of higher prices is worsened by what Guan describes as the “ostentatiousness” of high-net-worth individuals in the country, with recent headlines about ultra-rich foreign nationals snapping up multimillion-dollar luxury homes.

The island state this week unveiled a new long-term visa for high-earning foreign nationals as part of efforts to attract top global talent. Property market observers say the market is red-hot due to tight supply and new foreigners coming to the country following the easing of its Covid-19 restrictions earlier in the year.

Singapore families dismayed over rising inequality as inflation barely dents luxury home sales

Soaring inflation, growing rich-poor divide and declining social mobility have left middle-class families feeling the squeeze Those less well-off may have to dip into their savings and cut discretionary spending, analysts note, even as government moves to address wealth gap

Soaring inflation, growing rich-poor divide and declining social mobility have left middle-class families feeling the squeeze

Those less well-off may have to dip into their savings and cut discretionary spending, analysts note, even as government moves to address wealth gap