Low-wage workers had average of 7.8% pay hike

Office workers crossing Maxwell Road in Singapore's central business district. PHOTO: ST FILE

Low-wage workers were not left out of the pay hikes offered last year.

On average, those who received a built-in wage increase last year saw their basic pay rise by 7.8 per cent in nominal terms.

Low-wage workers doing outsourced work, such as cleaners or security guards, saw their basic wages rise slightly less - by 7 per cent.

These were among the findings in a report released by the Ministry of Manpower (MOM) yesterday.

Low-wage workers are classified as those earning a basic monthly pay of up to $1,300 a month. This threshold was raised last year under the National Wages Council (NWC) annual wage guidelines.

In 2017, when the threshold was $1,200, low-wage workers had basic wage increases of 8.9 per cent, while those in outsourced jobs had basic pay rises of 7.5 per cent.

MOM also said that about six in 10 private sector companies which hire low-wage workers gave them pay hikes last year, similar to the share who did so the year before.

However, only 45 per cent adopted the quantum of $50 to $70 recommended by the NWC for 2018 to 2019.

Companies with low-wage workers providing outsourced services seemed to fare better. A total of 71 per cent of them gave wage hikes to outsourced low-wage workers last year, up from 55 per cent in 2017. Also, 55 per cent last year adopted the NWC-recommended quantum.

Last year, the NWC also proposed for the first time that companies with productivity gains in the previous year give low-wage workers a one-off bonus of between $300 and $600, either in a lump sum or over several payments.

MOM's survey found that only one in five low-wage workers received a one-off special payment, and most of them received less than the recommended $300.

Firms that did not give the payout said they did not see productivity improvements, performed poorly or had already rewarded workers in non-monetary forms such as improved staff welfare.

National Trades Union Congress assistant secretary-general Zainal Sapari, a labour MP, said that while low-wage workers have seen their wages boosted by the progressive wage model, which sets wage floors for different skill levels in several industries, there are challenges in expanding the model to other sectors.

"We need a new major initiative to help low-wage workers. Hopefully, company training committees (where unions and firms collaborate on training) will give special attention to upskilling the low-wage workers to improve their productivity and, hence, wages," he said.

6 in 10 Proportion of private sector companies which hire low-wage workers that gave them pay increases last year.

Join ST's Telegram channel and get the latest breaking news delivered to you.

A version of this article appeared in the print edition of The Straits Times on May 30, 2019, with the headline Low-wage workers had average of 7.8% pay hike. Subscribe