Singapore companies to give workers 4.5% pay hikes in 2014, two surveys show

Business people walk through Raffles Place, Singapore's central business district, on Tuesday, Feb 13, 2007. Two separate surveys - by human resource consulting firms ECA International and Towers Watson - found that companies here are likel
Business people walk through Raffles Place, Singapore's central business district, on Tuesday, Feb 13, 2007. Two separate surveys - by human resource consulting firms ECA International and Towers Watson - found that companies here are likely to give employees an average salary increase of 4.5 per cent next year. -- FILE PHOTO: BLOOMBERG

Two separate surveys - by human resource consulting firms ECA International and Towers Watson - found that companies here are likely to give employees an average salary increase of 4.5 per cent next year.

The ECA survey found that while nominal wages will go up, real wages are forecast to fall to 1.8 per cent in 2014 after accounting for inflation.

That's down from the 2.2 per cent real wage increases that employees here are getting this year.

Asia as a whole is expected see the highest real-wage increase of 3.2 per cent, above the global average of 1.8 per cent.

ECA regional director for Asia Lee Quane said that companies in Singapore are not overly optimistic about the future due to the uncertain economic outlook.

But the high employment rate and tight labour market have meant that firms still need to offer higher wages to retain existing workers or attract new staff.

As a result, nominal wage increases for the past three years have plateaued at 4.5 per cent.

Separately, the Towers Watson's survey said the ongoing tightening of foreign worker policies here and government's push to increase pay for low-income workers will push overall wages up in the next few years.

The ECA survey interviewed 316 firms from 64 countries and territories from August to October this year, while the Towers Watson's survey saw 2,700 responses from companies across 20 Asia Pacific nations.