1. Singapore’s Wage Model and the Minimum Wage Debate
Singapore does not have an official minimum wage policy. Institutions like the National Wages Council (NWC) provide recommendations for fair wages, but these are not legally binding.
Instead of a traditional minimum wage system, Singapore employs the Progressive Wage Model (PWM). This model establishes baseline wages for Singaporean citizens and permanent residents in certain low-wage industries. It encompasses various employment categories, each representing common roles in the respective industries. Workers must receive wages no less than the PWM’s stipulated thresholds, which are determined based on their skills and employment levels.
Opposition parties in Singapore have previously advocated for introducing a minimum wage. However, the government favors the PWM, arguing that it better addresses the needs of low-income workers.
Currently, PWM is implemented in industries such as:
- Cleaning
- Security
- Landscaping
- Retail
- Food services
To ensure wage fairness, the government conducts periodic reviews and has set SGD 2,906 per month as the benchmark for a local living wage. For Singaporean citizens aged 30 and above earning less than SGD 2,500 per month, the Workfare Income Supplement (WIS) scheme offers financial assistance. This program provides direct cash payouts and enhances Central Provident Fund (CPF) contributions, reflecting a commitment to social security and practical support for low-income earners.
2. Addressing PWM Non-Compliance and the Local Qualifying Salary (LQS) Scheme
Regulatory bodies oversee PWM implementation in various sectors. For instance, the National Environment Agency (NEA) manages compliance in cleaning and waste management industries.
Employees who believe their wages fall below PWM standards should first approach the Ministry of Manpower (MOM) and, if necessary, involve their respective trade unions for formal resolution rather than directly contacting regulatory agencies.
Since PWM’s introduction in 2014, the Singapore government has penalized 57 licensed cleaning companies for non-compliance.
Additionally, the Local Qualifying Salary (LQS) scheme supports Singaporean workers by ensuring that employers meet specific citizen and permanent resident employment quotas before hiring foreign workers. This initiative aims to balance the labor market and protect local workers from being undercut by cheaper foreign labor.
3. Singapore’s Median Wage Trends and Outlook
As of now, Singapore’s median monthly income stands at SGD 4,752, positioning it as a wage leader in the ASEAN region—approximately ten times higher than neighboring countries like Vietnam and Indonesia. Between 2017 and 2022, the median wage grew by nearly 10%. However, due to global inflationary pressures, real wages declined by 1.5% in 2023, highlighting the disparity between nominal growth and purchasing power.
Despite global economic uncertainties, Singapore’s resilience as a financial hub is expected to bolster real income growth by 4% in 2024, underscoring an optimistic financial outlook for its residents.
4. Average Wages Across Different Sectors
The financial services sector remains Singapore’s highest-paying industry. Below is a sample of average monthly wages across various industries:
- Administrative and support services: SGD 2,925
- Healthcare and social services: SGD 4,680
- Real estate services: SGD 5,000
- Manufacturing: SGD 5,460
- Professional services: SGD 6,581
- Education: SGD 6,962
- Information and communications: SGD 7,000
- Financial and insurance services: SGD 8,190
5. Wage Disparities by Job Level
Wages in Singapore are closely tied to job roles and levels. In the tech industry, average annual salaries are as follows:
- Software Engineer: SGD 100,000
- DevOps Engineer: SGD 125,000
- Project Manager: SGD 170,000
- Chief Technology Officer (CTO): SGD 315,000
In financial analysis and planning, average annual earnings are:
- Analyst: SGD 73,000
- Senior Analyst: SGD 99,000
- Manager: SGD 147,000
- General Manager: SGD 252,000
6. Gender Pay Gap in Singapore
Singapore, like many other countries, faces a gender wage gap, with men earning about 10% more than women on average. This disparity arises from factors such as industry distribution—women are overrepresented in education and caregiving, while men dominate high-paying fields like finance. Women also often shoulder greater caregiving responsibilities.
Interestingly, women in Singapore earn more than men until the age of 29, likely due to men serving mandatory national service, which delays their early career progression. However, this trend reverses after age 30, coinciding with the typical age of first-time motherhood.
Despite some improvements, the gender wage gap remains significant, especially in core financial sectors. The gap has narrowed from 27.1% in 2012 to 15.6% in 2022. Advocacy groups like AWARE continue to push for greater gender equality.
7. Wages and Rights of International Workers
Singapore’s 1.5 million foreign workers, making up a substantial portion of the population, contribute significantly to its economy. They fall into two main categories:
- Low-skilled labor in sectors like construction and domestic work.
- Skilled professionals in industries such as finance and technology.
According to the 2020 census, half of foreign permanent residents earn between SGD 4,000 and SGD 4,999 per month. However, there are notable ethnic wage disparities. For example, over 60% of Malays earn below SGD 3,999, compared to lower percentages among other groups.
Legal protections for foreign workers, particularly in wages and basic rights, remain limited. Advocacy for improved treatment has gained traction as awareness of exploitation and discrimination issues grows.
8. Addressing Low Wages and Future Legislation
Singapore’s labor laws primarily protect citizens and permanent residents, offering limited safeguards to foreign workers. Employees can report employers who violate PWM standards or engage in illegal hiring practices to the Ministry of Manpower.
Trade unions may assist in cases of wage discrimination or low pay, but their influence is constrained under current legal frameworks.
The upcoming Workplace Fairness Legislation (WFL), set to take effect in late 2024, aims to combat workplace discrimination based on age, disability, race, family status, gender, and nationality. This new legislation represents a step toward a fairer work environment, providing employees with new avenues for redress.
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