Majority of Employers Plan to Raise Salaries Next Year
A recent survey by the Singapore Business Federation revealed that 2 in 3 employers are planning to raise wages in 2024, with an average increase of around 6%.
The remainder of the survey respondents indicated they would freeze salaries next year, while 1% said they planned to cut wages.
This is an encouraging sign of business resilience in the face of dragging global economic recovery. The expected pay increase would also help Singaporeans keep up with inflation, given that real wage growth was only 0.4% last year due to the erosionary effect of high inflation.
Perhaps unsurprisingly, there was a greater proportion of large companies (88%) aiming to raise salaries next year compared to SMEs (73%).
Encouragingly, employers remain optimistic about jobs, with 89% of respondents expecting to maintain or increase headcounts in the next 12 months. In contrast, only 80% of respondents had maintained or increased their labour force in the past 12 months.
What this may mean for you
While the survey is not binding or prescriptive, the outlook among employers is undeniably positive. This is significant given the uncertain economic sentiment for the coming year.
As such, there could be some relief headed your way if you’ve been looking for an income increase to cope with cost-of-living pressures. Companies that implement pay rises may also be more amenable to higher salary offers, creating a boon for jobseekers.
Related: Salary Increments and Pay Raises in Singapore – How Much to Expect in 2024 and the Near Future
COEs Retreat in November After Record-High
The latest COE bidding exercise saw COE prices bounce off October’s record-highs to settle at price ranges similar to those seen in the month prior.
November’s COE bidding results saw premiums fall across the board, led by Cat B and Open Category, which decreased by S$40,000 and S$32,993, respectively.
Cat A premiums fell by S$10,311, while a slightly smaller decline of S$6,789 was seen for Cat C COEs.
These reductions put the latest COEs at S$95,698 (Cat A), S$110,001 (Cat B), S$78,001 (Cat C) and S$125,011 (Cat E – Open), closer to levels previously seen.
What this may mean for you
The sharp reduction in COE prices – especially for Cat B and Open category – may look like an opportunity to commit to a car purchase, but this may be a mistake.
The fact is, COE prices are at record levels, and the last time COE prices breached the six-figure mark was in 2013. That means there should still be room for premiums to come down further.
Besides, the Land Transport Authority has announced adjustments to the COE supply, with around 3,500 new certificates due to be added across Categories A, B and C for the quarter spanning November to January.
This should further relieve upward pressure, helping COEs to come down even further. Those that can afford to, should wait a little longer to allow COE prices to find a new, lower level. Alternatively, consider getting an off-peak car.
Related: Car Rental vs Car Sharing vs GrabCar — Which Is The Most Cost-Effective?
Singapore’s Economy Expected to Grow 1% to 3% in 2024
The Ministry of Trade and Industry (MTI) estimates Singapore’s economy to grow between 1% to 3% next year.
This is in line with the prevailing sentiment that the global economy will continue to see sluggish growth through the first half of 2024, but with most major economies picking up gradually in the second half of the year.
Combined with an expected normalisation of inventory, global manufacturing activity is expected to turn around over the course of the year.
Amidst this backdrop, growth prospects of manufacturing and trade-related sectors in Singapore are expected to improve in tandem, marking a much-awaited turnaround in the manufacturing sector after continued declines throughout 2023.
Related: Key Financial Trends of October 2023
What this may mean for you
While not the most exuberant forecast, expected growth of between 1% to 3% for an advanced economy like ours is nonetheless an optimistic sign. This is especially so, given the wider global economic context.
Barring any black swan events or severe breakdowns, this could well translate to business-as-usual for Singapore and a relatively smooth ride through 2024, even as the world continues to navigate post-pandemic conditions, continued unrest and stubbornly high inflation.
Not terribly exciting, but not terrible either, and given the turmoil and uncertainty of the previous three years, less excitement would surely be welcome.
Middle-income Salaries Grew Fastest in the Past Decade
Middle-income earners – between the 21st and the 80th percentile – saw the fastest rate of wage growth in the past decade.
From 2011 to 2021, nominal income for the group grew by 42% on average, while earners in the highest and lowest quintiles saw increases of just 36%.
This was revealed by the Monetary Authority of Singapore (MAS) in its latest biannual macroeconomic review, which sorted Singapore resident employees according to income percentiles of their age cohorts.
MAS added that almost half of middle-income earners moved up the earnings ladder between 2011 and 2021, 45% moving up one income decile, and 23% climbing by two or more income deciles.
The largest gains were experienced by middle-income workers who moved to larger or more productive companies. This group saw their incomes more than double over the 10 years.
What this may mean for you
If you’re earning an average salary but feeling stuck in a rut, these statistics say you’re advancing faster than you might think.
This report also confirms that generally speaking, larger companies provide better income prospects, as do companies that make it a point to be more productive (read: hardworking) than their peers.
Related: Five Salary Negotiation Tips for Your New Job
To better prepare for the upcoming trends, check out our roundups of the best savings accounts and best car insurance in Singapore.
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Cover image source: Unsplash
The article originally appeared on ValueChampion.
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