Should we take out the job in Singapore?

We change our job for several reasons, it may be for career advancement, it may be for gaining new knowledge and skill, it may be for better organization prospect, it may be for family reason,...etc. Nevertheless, one main reason shall be for more $$...

In most of our thoughts, a Malaysian working in Singapore shall earn a lot more, because of the stronger SGD compared to RM. By getting SGD1,000 is equivalent to getting RM2,300. For fresh grad engineer in Malaysia with 1st class honours, we are getting around RM2,800. It is the same for Singapore, fresh grad engineer is getting SGD2,800 to SGD3,000.

I have read an article on comparing your purchase power using Big Mac Index. It is comparing the value of the money that you earn by comparing the price of a Big Mac in the country that you are working at. Why Big Mac? Because it is sell in over 120 nations world wide and it is the most easy accessible item in a country. It is a good representation of the "real" value of the currency in your monthly income.

For example: If you are earning RM3,000 in Malaysia and you have been offered a job in Singapore at SGD3,000. It seems like you have got a good deal, with a currency conversion of RM2.30/SGD, it resulted in a pay raise of RM3,900 or 130%. But actually by comparing using the Big Mac Index, it shall shows something much less...

From the above, Malaysian's Big Mac Index is 2.08 and Singapore's Big Mac Index is 3.19 as compared to USD. So the Purchase Power Parity (PPP) ratio is 0.6520. Where your actual value of SGD3,000 new salary has only a value of RM4,601. Big Mac Index shows that RM is actually undervalued. Thus, your actual income raise is actually only 53% instead of earlier 130%. It is still not a bad deal though...

[Note: There are other factor to be considered as well when make this comparison, namely some factors between two countries are inflation rate, value-added tax (GST), personal tax, supply and demand of Big Max etc. We are comparing just on one consumer product, i.e. Big Mac, for the value of our salary, it may not be too representative. Nevertheless, it is a good base guide...don't rush to make decision when job hop to other country]