askST Jobs: Feeling the pinch? Here’s what to do if your pay rise is not matching inflation rate
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When salary increments do not keep pace with rising costs, Singaporeans may find themselves playing catch-up with their purchasing power.
ST ILLUSTRATION: LEE YU HUI
Megan Wee
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In this series, journalist Megan Wee offers practical answers to candid questions on navigating workplace challenges and getting ahead in your career. Get more tips by signing up to The Straits Times’ Headstart newsletter
Q: With cost-of-living issues a key concern for many Singaporeans, what can workers whose pay rises do not keep up with the inflation rate do?
A: If employees discover that their pay increments are not keeping up with the inflation rate, it would be appropriate for them to discuss the matter with their supervisor or manager in a respectful and transparent manner, says recruitment agency Randstad Singapore’s country director, Mr David Blasco.
He says annual standard salary increments should minimally match the reported inflation rate for the year to ensure that employees maintain their purchasing power and quality of life, especially as the cost of living rises.
Mr Vic Sithasanan, Singapore managing director at employment marketplace Jobstreet by Seek, says that while Singapore’s inflation eased to around 2.4 per cent in 2024, many people are still grappling with the lingering effects of sharp cost increases in late 2022 and early 2023.
When salary increments do not keep pace, Singaporeans may find themselves playing catch-up with their purchasing power, he adds.
So, how can employees check whether their pay is keeping up with inflation?
According to Ms Samantha Tan, a human resources business partner at Seek, employees can compare the current salary with what they were earning in the previous year, adjusted for inflation.
They can make use of inflation calculators available online, she adds.
Fresh graduates who do not have a salary history can refer to salary benchmarks, such as from Jobstreet’s Talent Attraction Lab, to have a better grasp of where their salary expectations should lie, Ms Tan says.
When there is a mismatch between the salary increment and the inflation rate, Mr Blasco recommends that employees take these steps:
Review whether your pay reflects your job responsibilities and performance against the latest industry salary benchmarks, and gather information from your latest performance review.
Explain to your supervisors how your salary has not kept up with inflation and the impact on your real income, and highlight your contributions to the organisation.
Approach the conversations with supervisors in a collaborative manner – show that you are there to understand the factors that determine your salary increment.
Assess your pay based on factors such as market demand for skills, industry benchmarks, internal pay structure and the company’s profitability.
Ms Tan encourages employees to look at their full compensation and benefits package, which can include bonuses, performance incentives, flexi benefits, learning opportunities and work-life flexibility. These can contribute to one’s holistic well-being and satisfaction, she notes.
“These can at times be incredibly more priceless compared with a small annual increment,” she says, adding that they can help employees better fulfil their professional and personal aspirations.
Mr Jason Quay, director of outsourcing at recruitment agency Adecco Singapore, says it is worthwhile for employees to evaluate the monetary value of what is being offered. For example, if the company provides $1,200 in flexible benefits, the real value should be taken into account even if it is not reflected in the base salary.
If salary is top of mind, Mr Blasco says employees should assess the talent market supply and demand.
This can guide career decisions about whether they should stay in their organisation, or proactively seek employers that are offering a higher pay.
Ultimately, he emphasises the importance of navigating the process carefully.
“Continuing to communicate professionally and maintaining positive relationships during this process can also help you to retain a strong reputation and not burn bridges.”
Have a question? Send it to askst@sph.com.sg
