Wages in Singapore grew 0.4 per cent in 2023 after accounting for inflation, the same rate of growth as in 2022, the Ministry of Manpower (MOM) said on Tuesday (Jun 25).
In 2021, real wages grew 1.6 per cent. Aside from the slight increase that year, real wage growth has been on a downward trend since 2018.
Nominal total wages of full-time resident employees who had been with the same employer for at least one year grew 5.2 per cent last year, at a slower pace than the 6.5 per cent in 2022.
That said, nominal total wage growth remained higher than the range seen in non-recessionary years, MOM said.
Nominal wage growth does not take inflation into account, and was at its highest in a decade in 2022.
All industries and all types of employees experienced wage growth last year, the ministry said, though it pointed out that the changes were smaller than in the year before.
The wage growth of senior management employees was 4.6 per cent, while rank-and-file and junior management employees experienced 4.8 per cent and 6.3 per cent wage growth respectively.
In terms of industries, most saw lower wage growth than in the year before, but wages in administrative and support services grew faster because of the Progressive Wage Model, MOM said.
More than eight in 10 firms were profitable last year, but profitability was affected by slower economic growth.
Fewer firms gave wage increases to their employees, with the proportion declining from 72.2 per cent in 2022 to 65.6 per cent in 2023.
A total of 6.5 per cent of establishments cut wages, and 27.9 per cent of firms held wages steady.
Among firms that raised wages, the size of the increase was 7.2 per cent last year, smaller than the 7.9 per cent in 2022. Among firms that reduced wages, the size of the decrease was 6.2 per cent in 2023, larger than the 4.5 per cent reported in the year before.
Mr Ang Boon Heng, director of Manpower Research and Statistics at MOM, said the decline in wages was mainly due to a reduction in bonuses.
“The bonus component is reduced because it links back to the economy again, (which) is doing okay, but not as well as (before),” said Mr Ang.
On the other hand, the increase in wages was seen more in basic wages.
EXPECTATIONS FOR WAGE GROWTH IN 2024
Looking ahead, the job market remains tight and there is strong demand for professionals, managers, executives and technicians in industries such as information and communications, financial services, professional services and health and social services, said the ministry.
“These developments could result in higher wage growth in these sectors in 2024 compared to 2023. However, with an uncertain business environment, establishments might adopt a cautious stance with respect to wage increases,” said MOM.
Polls in the first quarter of this year showed that fewer firms intend to raise the wages of their employees in the next three months.
“On balance, we expect the nominal wage growth in 2024 to remain similar to 2023. With inflation expected to stay on a gradually moderating trend, we expect an improvement in real wage growth.”
Source: CNA/an(ac)
