Workers in the financial and insurance services sector took home the biggest pay rise at 6.3 per cent, while pay rises for construction and retail workers were only 2.8 per cent and 3 per cent respectively.—TODAY pic
SINGAPORE, May 31 — More employees in Singapore enjoyed a pay rise last year than in 2017, and better still, that increase was bigger, thanks to stronger economic and labour market conditions.
Workers in the financial and insurance services sector took home the biggest pay rise — 6.3 per cent — while pay rises for construction and retail workers were only 2.8 per cent and 3 per cent respectively.
Across the private sector workforce, even when cost of living rises — inflation of 0.4 per cent — are stripped out, employees still notched up a 4.2 per cent increase in real wages on average, markedly better than the 3.2 per cent rise in 2017.
This pace of wage increases had slowed from 5.4 per cent in 2015 to 3.6 per cent in 2016.
The findings were published by the Ministry of Manpower (MOM) in its Report on Wage Practices 2018, which was released on Wednesday (May 29).
Key findings from the Survey on Annual Wage Changes 2018. — Infographic courtesy of Singapore Ministry of Manpower
In its report, the ministry said that the higher total wage growth stemmed from a higher basic wage increase of 4 per cent, and an increase in bonuses from two months of basic wage in 2017 to 2.06 months in 2018.
What led to employees receiving better pay
The MOM said that 2018 saw:
In line with the better economic landscape, the MOM said the proportion of profitable establishments rose as well last year.
And that meant the percentage of firms that raised the wages of their employees rose somewhat to 67 per cent in 2018, compared to 65 per cent in 2017.
This was reflected in 81 per cent of employees receiving higher pay in 2018, up from the previous year’s 78 per cent.
And fewer employees received a wage cut last year, down from 10 per cent in 2017 to 8 per cent in 2018.
However, the MOM said the cuts were “deeper” for workers that did take a cut in 2018. These employees saw their wages falling by 4.3 per cent in 2018, compared to a 3.9 per cent drop in 2017.
How about low-wage workers?
Reasons companies cited for not increasing workers’ pay
Low-wage workers performing in outsourced jobs
Top three industries that saw highest total wage change
Who was involved in the study
Reactions to the report’s findings
Seah added that productivity growth in the construction sector is one of the weakest, but it should not come as a surprise that it has the lowest wage growth as well because the majority of the labour force is foreign.
He said the outlook for the retail sector is not positive as the threat from e-commerce is unlikely to be going away anytime soon.
On companies adopting NWC’s guidelines
“This is testament of the efforts by our unions and Singapore National Employers Federation in communicating the guidelines and encouraging companies to adopt it,” he said.
He added that the labour movement should continue to engage companies and to “work closely together” on ways to adopt the NWC guidelines in their companies, taking into consideration the varied circumstances each company faces.
He said the labour movement and the unions should continue to monitor their respective sector’s performance closely and “ensure employers reward their employees” with wage increase that matches the firms’ performance, productivity gains and employee’s contribution.
He added that this is especially so for the manufacturing sector where “productivity is higher than wage growth over the last five years”.
What some companies are saying
But as a result, his customers have to bear the increase in the cost of services. “Most of them understand this as it is not fair for us to absorb the costs,” he said.
Tan added that operating his business is a challenge as the cleaning sector is a “price war” with very low profit margins.
Still, he tries to reward his employees when he can by giving them red packets on special occasions such as Chinese New Year.
Reachfield Security & Safety has also been following the NWC’s guidelines. The security company’s general manager Grace Lim said that it has not been an issue for the firm to adhere to the recommendations for its 1,000 employees. — TODAY
