Salaries in Singapore grew by 4.6% in 2018, 4.2% after accounting for inflation

As a result of the Singapore economy growing by a healthy 3.1% in 2018, total wages (including employer CPF contributions) in the private sector grew by 4.6% in 2018 (vs 3.8% in 2017). This stemmed from a higher basic wage increase of 4% and an increase in bonus to 2.06 months of basic wage in 2018.

After accounting for inflation, real total wage growth was 4.2% in 2018, higher than the 3.2% in 2017. This brings the median monthly salary for residents to S$4,437, up from S$4,232 in 2017.

This is per the Report on Wage Practices 2018 by the Ministry of Manpower, which took inputs from 5,300 private companies with at least 10 employees each. Together, the respondent companies employ 1,200,000 employees (584,100 local full-time employees and 428,000 foreign employees).

Salary increases by: Sector, type of employees

The highest salary increases were recorded in the financial & insurance services, and professional services sectors; while salaries remain stable in manufacturing, reflecting the uneven output growth within the sector. Food & beverage, and retail trade saw the quantum of wage growth dipping.

Meanwhile, various employees across the hierarchy saw the following rates of total wage growth:

1. Senior management: 3.9% in 2018 vs 3.3 in 2017
2. Rank-and file (RAF): 4.2% in 2018 vs 3.8 in 2017
3. Non-RAF: 4.9% in 2018 vs 3.8 in 2017
4. Junior management: 5.4% in 2018 vs 4.1 in 2017

This has been shown in greater detail in the following table:

Overall, 67% of companies confirmed they handed out salary increases in 2018 (vs 65% in 2017), while the proportion of companies that cut total wages in 2018 (9%) fell from 2017 (12%).

For employees who received wage cuts, though the average wage cut was higher in 2018 (-4.3%) compared to 2017 (-3.9%), their proportion among all employees decreased from 10% in 2017 to 8% in 2018.

The biggest considerations in determining wage growth

Profitability, found the research. The performance of the companies, as well as the individuals themselves the main considerations for employers - thus, profitable companies gave higher wage increases and bonuses compared to loss-making ones.

All images / Report On Wage Practices 2018