Real median income in Singapore falls 2.3% this year
Workers are feeling the pinch in 2023, as high inflation takes its toll on their wage growth.
In preliminary labour force data released on Nov 30, the Ministry of Manpower (MOM) said resident (Singaporeans and permanent residents) workers at the 20th-percentile salary level saw their real incomes fall 3 per cent year on year, while those drawing the median wage saw a 2.3 per cent decrease year on year.
Singapore's employment rate for residents aged 15 and over also fell from 2022's historical high of 67.5 per cent in an "exceptionally tight" labour market to 66.2 per cent.
MOM said the labour market remained tight in 2023, with unemployment and long-term unemployment rates declining for both professionals, managers, executives and technicians (PMETs), and those not in such roles.
The decline in employment rate over the year was due to more residents staying outside the labour force, and not because of difficulties with seeking employment.
The labour force participation rate among residents aged 15 and over declined from 70 per cent in 2022 to 68.6 per cent in 2023, it noted.
MOM added that labour demand is easing as the number of job vacancies fell for five consecutive quarters and the ratio of job vacancies to unemployed persons "also dipped significantly" for the second consecutive quarter to 1.94 in June 2023.
Non-PMETs saw a larger decline in unemployment rate, from 4.4 per cent in 2022 to 3.6 per cent in 2023, compared to that for PMETs, which dropped from 2.6 per cent to 2.4 per cent over the same period.
Long-term unemployment rate fell more for non-PMETs, from 0.7 per cent to 0.5 per cent, compared to a 0.1 percentage point decline to 0.4 per cent for PMETs over the same period.
The ministry said the proportion of employees in permanent jobs rose to 90.5 per cent, the highest percentage since 2016.
Nominal income level, which does not take into account inflation, was higher in 2023 than 2022. At the 20th-percentile income level, workers earned $2,826 in 2023, up from 2022's $2,779.
Even after accounting for Workfare Income Supplement (WIS) and related payments, real wages for those at the 20th-percentile wage level still declined by 2.1 per cent.
"While real income growth for the remainder of 2023 is likely to remain negative, we expect an improvement in real income growth in 2024 with inflation easing."