In understanding the severity of the problems faced by low-income employees, one also needs to take into account the duration of the individuals/families being in poverty (i.e. the trend of earnings mobility) to ensure that our society has provided opportunities for the low-income employees and their families to move up the earnings ladder.
A study on earnings mobility conducted in 2001 indicates ample opportunities for upward mobility. Between 1991 and 2000, 58% of the employed persons at the lowest 20% of the earnings distribution had managed to move up the earnings ladder in ten years’ time. Over this period, the probabilities of employed persons moving up, staying put and moving down the earnings ladder were roughly the same, at slightly more than 30% each. Details of the findings are here.
In view of the changing economic pattern and performance over the past few years, the Government Economist has conducted a similar study to gauge the mobility situation in the more recent years. Details are here.