2022 ASRJC JC1 H1 Promo Sugg Ans

2022 ASRJC H1 Economics Promo Suggested Answers © ASRJC 8843/JC1 Promotional Examination/2022 [Turn over Question 1: Healthcare Issues Figure 1: Singapore’s labour cost index Source: Tradingeconomics.com, accessed 10 August 2022 Extract 1: Firms offering higher pay due to manpower crunch, thus driving up costs Rising manpower costs and the lack of available manpower, resulting from border restrictions to curb the spread of Covid-19, are some of the top challenges that companies face. This was found through an annual survey by the Singapore Business Federation (SBF), which polled companies here on how the pandemic has affected their business this year and their outlook going forward. SBF's chief executive officer Lam Yi Young said in a media briefing on Wednesday (Dec 8) that companies have had to increase their wages to retain their workers or get others to jump ship, leading to higher manpower costs. "I think it's very much driven by overall shortage of skilled workers in particular sectors. Companies, on one hand, are worried about rising manpower costs, but they feel they have no choice but to pay more in order to get the people they need, which then leads to even higher manpower costs," Mr Lam said. Adapted from Todayonline, 8 December 2021 Extract 2: Healthcare spending on the rise because of higher utilisation, rising manpower costs Singapore's healthcare expenditure is set to continue to increase, Health Minister Gan Kim Yong said in Parliament on Thursday (Mar 5). He said that Singapore’s national health expenditure increased from S$13 billion in 2012 to S$22 billion in 2017, or about 11% per annum. Breaking this down, Mr Gan said , “part of this increase was due to increased utilisation . As our population ages and grows, demand for healthcare services also increases. Singapore is also utilising more healthcare than in the past, even after accounting for ageing and population growth . This is partly the result of making healthcare more accessible and affordable to all, earlier diagnosis, closer monitoring and follow-ups for medical conditions.” Another part of the growth in national health expenditure can be attributed to higher manpower costs. “On one hand, our healthcare workforce expanded significantly between 2012 and 2017. On the other

2 © ASRJC 8843/JC1 Promotional Examination/2022 hand, our healthcare workers’ salaries also increased as we implemented pay adjustments to attract and retain our healthcare workers,” Mr Gan said. “Keeping everyone healthy is a team effort, and we are all part of the team. So let us all play our part to keep Singapore and Singaporeans in good health,” he said. Adapted from CNA, 5 March 2020 Table 1: Price elasticity of demand values for selected healthcare products and services in the United States Pharmaceutical Products Emergency