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Singapore’s effort to create a local-core workforce may be paying off.
According to the Ministry of Manpower’s (MOM) Labour Report for 2013, unemployment in the country remained low and employment creation remained high thanks to 4% increase in local employment rates.
This growth was higher than the 2.9% reported in 2012, with the report noting foreign employment gains have continued to moderate. It now stands at 4.2%, a slight drop from 5.9% the previous year.
But MOM cautioned these improvements will put pressure on wages as more foreign worker policies come into effect.
The report indicated real income growth also strengthened last year; the real median monthly income, which included employer CPF contributions for full-time employed Singapore citizens, was 4.6% in 2013, a sharp increase from 1.2% in 2012.
“Cumulatively, the median income (including employer CPF contributions) of full-time employed citizens rose by 27% from $2,748 in 2008 to $3,480 in 2013, or 4.8% per annum (p.a.),” the report said.
“After adjusting for inflation using CPI (the Consumer Price Index) for all items, real median income grew by 8.7% or 1.7% p.a. over the recent five years.”
MOM added companies have to continue focusing on improving productivity and reduce their dependence on manpower as the “current high rate of local workforce growth will be difficult to sustain in the long run due to demographic constraints”.
“Labour productivity growth has also lagged behind income growth slightly in the past five years. Firms will need to implement more manpower-lean methods of driving business growth in order to survive and thrive,” it said.