It’s already mid-2017, and yet it seems we still can’t leave the horrible year 2016 in the past.
It’s already mid-2017, and yet it seems we still can’t leave the horrible year 2016 in the past. According to the recently released Report on Wage Practices 2016 by the Ministry of Manpower (MOM), the total wages of private sector employees only grew at 3.1 percent last year, down significantly from the 4.9 percent experienced in 2015. Bonuses, however, remained steady at an average of 2.16 times the basic wage an employee earns.
Breaking down the numbers into companies, it’s notable that more firms cut wages and less raised salaries in 2016, as compared to 2015. Last year, 58 percent of companies raised wages for employees, down 6 percent from the year before, while 17 percent of companies had reduced salaries, up from the 11 percent in 2015.
These numbers likely have to do with the fall in profit for companies in 2016’s tough economic landscape. According to the report, 24 percent of companies suffered a loss last year, which is up 3 percent from 2015. Moreover, amongst those that did turn a profit, 41 percent saw a small profit margin than they had the previous year.
More Following National Wage Council’s Recommendations
Despite the overall bleak outlook of the report, it did include some bright spots for those in the lower income bracket. While growth for low-wage workers stayed low at 40 percent of the workforce, more companies are starting to follow the National Wages Council’s (NWC) recommended quantum for these low-wage workers, with the percentage up 3 points to 21 percent.
The report also noted that for workers earning up to S$1,100, 61 percent saw wage increases, higher than the national average. “As the majority of low-wage employees on outsourced service contracts were working in Progressive Wage Model sectors such as cleaning, landscaping and security, they enjoyed higher wage increases than low-wage employees in general,” MOM said.
