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Higher wage increases were enjoyed by local employees in 2013, amid the tight labour market and improved economic conditions.
This was the key finding of the Report on Wage Practices 2013, conducted by Ministry of Manpower’s Research and Statistics Department.
The report found total wages (including employer CPF contributions) in the private sector grew by 5.3% in 2013. The figure was higher than the local wage increases of 4.2% in 2012.
The report highlighted this rise in wages could be attributed to more employers following the National Wages Council’s (NWC) recommendation to give a built-in wage increase to low-wage employees earning a basic monthly salary of up to $1,000.
“There has been a general uptrend in the implementation of the flexible wage measures since the release of the tripartite wage restructuring recommendations in January 2004, resulting in a large majority of employees in the private sector being under some form of flexible wage system,” the study stated.
Up to December 2013, nearly eight in 10 (77%) private establishments with employees earning a monthly basic salary of up to $1,000 gave or intended to give wage increases to these employees in 2013, a substantial rise from the 60% in 2012.
This included 57% of establishments that gave at least $60 built-in wage increase as recommended by NWC in 2013, up from the 28% that gave at least $50 recommended in the preceding year.
“Having a narrow maximum-minimum salary ratio was the most common wage recommendation adopted, with 63% of private sector employees working in establishments with this flexible wage component. This was followed by linking variable bonus to key performance indicators (51%) and having the monthly variable component (34%) in the wage structure,” the report stated.