SINGAPORE: Senior Minister of State for Manpower Zaqy Mohamad said in Parliament on Tuesday (Nov 7) that the real median income in Singapore fell by 4.5 per cent in the first half of this year, in comparison to the first half of 2022. Mr Zaqy said that the figure is based on preliminary estimates and that workers in various sectors felt this decrease. Real median income is defined as the inflation-adjusted amount of money a median household earns per year.
The Senior Minister of State said that the decrease in the real median income was due to higher inflation amid a weak economic outlook, although he added that inflation is expected to moderate for the rest of 2023. “That means, hopefully, the situation with the declines in real incomes potentially moderates,” Mr Zaqy said.
As for nominal median income, which doesn’t take inflation into consideration, it rose by 0.9 per cent in the first six months of the year. MPs Edward Chia (Holland-Bukit Timah GRC) and Saktiandi Supaat (Bishan-Toa Payoh GRC) raised questions in Parliament concerning how the increase in prices has affected income growth for workers in Singapore, particularly for workers who are already vulnerable.
While a median 1.8 per cent growth in real income per year occurred from 2017 to 2022, resulting in a total of 9.8 per cent, this figure has been even better for lower-income workers, who saw a 2.9 per cent increase per year, for a total of 15.4 per cent.
“This means that as costs of living rose, the incomes of lower-wage workers rose even more, thereby narrowing the income gap between lower-wage workers and the median worker,” he said. For next year, as the demand for labour slows, nominal wage growth for resident workers is expected to ease, he added, although this could prove to be the opposite for other sectors.
“Wage increments are expected to stay firm in travel-related sectors where demand continues to recover, as well as more labour-intensive services sectors where manpower shortages could be more persistent,” pointed out the Senior Minister of State.
Official data from Oct 23 showed that the core inflation in Singapore in September eased to 3.0 per cent on a year-on-year basis. It has decreased from this year’s high of 5.5 per cent in January and February, which marked a 14-year-high.
This means that the country’s key consumer price gauge is the lowest since March 2022, when it was at 2.9 per cent. September’s inflation rate is also in line with the 3.1 per cent rate economists had forecast in a poll for Reuters.
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