To be or not to be
Being better off is not just a matter of hard work
We passed by the cemetery located throughout the slope of the hill. By any observation, the cemetery is packed. The mute white tombs interspersed among the engulfing, dark soil. With me were the young kids whom I volunteered to chauffeur for a program. To prove my root in the neighborhood, I told them, “My grandma was buried here.”
To my shock, one of the kids replied to me, “My dad, too”.
That caught me by surprise. As muted as the white tombs, I was buried in silence. These kids are selected from Program Perumahan Awam (PPR), a public housing system in the heart of Kuala Lumpur. With social organisations like Projek Ihsan that provides free tuition to characteristically low-performing students in a B40 area, these kids are tutored to be able to catch up with their peers, or at least one step above from where they lagged. Most of them come from lower income family with parents working day and night. Some of them were raised by a single parent.
Education is important, and without a proper one, it might be hard for an individual to move up his or her socioeconomic status. The move from one socioeconomic bracket to another is called social mobility. Khazanah Research Institutes (KRI) has published a study on the social mobility of Malaysians. A study in Florence on 1427 census data with the tax data from the same surname in 2011 found out that socio-economic status may persist even up to six centuries apart, meaning the descendants of lower income family may continue to be so, up to six to seven generations!
Rising cost of living and plateauing wages retard social mobility for some families. Inequality and lack of access to opportunities are considered the biggest challenge to move up in social mobility. One of the more infamous PPRs is in Pantai Dalam-Kerinchi area. The area has witnessed quite a transformation. Sandwiched between urban areas like Bangsar and Bangsar South, Mont Kiara and Pantai Hillpark, and only 10–15 minutes away from Kuala Lumpur City Centre, inequality has been slapping right across their faces. It becomes worse for the current generation.
ARE WE INEQUAL?
Gini coefficient, a number used to describe the state of inequality of the nation, has indicated a remarkable figure of 0.3099 (with 0 being total equality and 1 for total inequality) for household income Malaysia. Some reports however claim the data to be somewhat misleading due to inconsistency and drastic changes. Other argues the Household Income Survey (HIS) data collected, although consistent and extensive, may not reflect the other dimensions of inequality (i.e. earning inequality, wealth inequality, etc). Based on the proxies the researchers selected to depict labor market and economic conditions, the inequality registered are higher than the official figure, which lends credit to the public sentiment of inequality that grows larger by day.
The paper finds that there are more concentration at the top. Data proxies like Employee Provident Fund (EPF) indicated that the top 1 percent of the population holds 15% of total EPF savings in comparison to only 8% ownership by the bottom 50%. Other proxies like the number of civil servants by positions, home ownership transaction, car purchases and ownership in public and private funds also indicated higher inequality than officially reported figure. The summary of the some findings are tabulated as below.
The authors recommended higher degree of access to the raw data from HIS so independent research can utilize it and suggest better academic standpoint on the issue of inequality in Malaysia.
CAN YOUR KIDS BECOME WEALTHIER THAN YOU?
It is hard to see future, unless you are Sorcerer Supreme who can control time stone. However, there is a lot we can tell from our data collected in the past. Just like the Florentines did.
Malaysia, unfortunately, does not have data spanning sixth centuries. With the exception of the the study by KRI, a national study of the changes of income between generations is non-existent. For the purpose of the study, the income of the parents (born between 1945–1960)were compared when they were 35 to that of their children age 25–40 years old. Interestingly, the children from lower income family, most of them (56–74%) fared better than their parents and move upward in the income bracket. However, those from the middle income family has shown an apparent “middle income” squeeze. While they may manage to earn more than their parents, they are not moving upward in their income bracket (i.e., from M40 to T20).
…the low mobility leads to “existence of a glass ceiling for children from low income families and a glass floor for children from high income families”
Globally, Malaysia fares better in terms of social mobility. Kids from poor family can elevate their low income status to middle income, but are more likely to stay there. Inequality and lack of social mobility is an epidemic even in the most developed economies have no cure. For instance,the USA, UK, and Canada reported 50%, 25% and, 33% chances, respectively, that a child born into low income family become low income adult; and the low mobility leads to “existence of a glass ceiling for children from low income families and a glass floor for children from high income families”, as the study suggests.
