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Real wages in Singapore fall by 0.4 per cent
Wages in Singapore after adjusting for inflation fell by 0.4 per cent last year despite the tight labour market, according to the Ministry of Manpower.
The "Report on Wage Practices, 2012" released by the ministry on Wednesday showed that total wages, including employer CPF contributions, in the private sector rose by 4.2 per cent, lower than the growth of 6.1 per cent in 2011.
The benefit from the rise in wages last year was effectively erased by the 4.6 per cent increase in the Consumer Price Index for all items for the period.
The resulting 0.4 per cent decline in real wages last year stands in contrast to the 0.9 per cent gain the previous year.
The report blamed weaker economic conditions last year for the slower pace in nominal wage growth.
Last year, Singapore's real gross domestic product growth (GDP) moderated to 1.3 per cent from 5.2 per cent the year before.
The ministry also said that amid slower GDP growth and continued high employment creation, labour productivity shrank by 2.6 per cent last year after rising by 1.3 per cent the year before.
It noted that, in the last five years, labour productivity fell by 0.4 per cent per year as economic growth was driven more by employment.
Total employment increased by 129,100 or 4.0 per cent last year and the overall unemployment rate in Singapore remained low at 2 per cent for the period.
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