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Singaporeans enjoyed a higher amount of income in 2015, according to the Singapore Department of Statistics.
Titled “Key Household Income Trends, 2015“, the report highlighted median household income from work increased both in nominal and real terms.
For employed households, the median monthly income was $8,666, a 4.9% increase over 2014, after adjusting for inflation.
The report specified from 2010 to 2015, the median monthly household income from work of resident employed households rose by 20.4% cumulatively or 3.8% per annum in real terms.
“Taking household size into account, median monthly household income from work per household member recorded 5.0% nominal growth, or 5.4% real growth, in 2015,” the report stated.
“The rise in median household income per household member came amid a tight labour market, as well as an increase in the employer CPF contribution rates in 2015.”
Comfortingly, the rise in income was felt across all income groups.
Interestingly, the lowest 20% of households had the fastest real income growth, with households in the lowest and 2nd lowest deciles recording growth of 10.7% and 8.3% respectively.
The report attributed this rise in income partly due to on-going intiatives to raise pay of low-wage workers.
The income growth across the board resulted in a relatively stable Gini coefficient of 0.463 last year.
The Gini coefficient is a measure of income inequality. It ranges from zero to one, with higher values indicating greater inequality.
Singapore’s Ministry of Trade and Industry (MTI) warned, however, the strong wage growth that workers enjoyed last year might not be sustainable.
This is considering the current lacklustre economic outlook and Singapore’s flagging labour productivity.
A study released by MTI last week found the real average wage growth of resident workers in Singapore outpaced labour productivity growth over the last decade (i.e., 2005 to 2015), and also in the more recent five-year period (i.e., 2010 to 2015).
Labour productivity grew at an average annual rate of 0.5% from 2005 to last year, while the real average monthly earnings of resident workers increased by 1% a year over the same period.
In light of this, the report warned of the possibility of wage increases being affected if productivity wasn’t increased in the long run.
“It remains vital for us to press on with the productivity drive, as it is only by raising productivity that wage increases can be sustainable,” it stated.