Report: Singapore salaries rise at slower pace, but workers gain more purchasing power in 2025
SINGAPORE, May 29 — Workers in Singapore enjoyed stronger spending power last year as inflation cooled significantly, allowing real wages to grow faster even though salary increases moderated, according to a new labour report.
Data released by Singapore’s Ministry of Manpower (MOM) showed nominal wages for full-time employees, including employer Central Provident Fund contributions, rose 4.9 per cent in 2025, down from 5.6 per cent a year earlier. However, after accounting for inflation, real wages increased by 4 per cent, up from 3.2 per cent in 2024.
The improvement came as Singapore’s inflation rate fell sharply to an average of 0.9 per cent in 2025 from 2.4 per cent the previous year, giving workers greater purchasing power despite slower pay growth. The findings were based on a survey of 6,236 private-sector firms employing more than one million workers.
The report also pointed to improving business conditions. More than 83 per cent of companies reported being profitable in 2025, up from 80.8 per cent in 2024, while the proportion of firms making losses fell to 16.9 per cent from 19.2 per cent.
Yet stronger profitability did not translate into more widespread wage increases.
About 72.4 per cent of firms raised salaries in 2025, down from 78.3 per cent the year before, while a larger share chose to keep wages unchanged. MOM said easing inflation may have reduced pressure on employers to grant bigger pay rises. Among firms that did increase salaries, the average adjustment was 5.8 per cent, with retaining employees cited as the main reason.
Only 3.1 per cent of firms cut wages, a slight improvement from 3.2 per cent in 2024.
Wage growth remained positive across all employee groups and industries. Rank-and-file workers recorded wage growth of 4.8 per cent, while junior management and senior management employees saw increases of 5.1 per cent and 4.9 per cent respectively.
Among sectors, administrative and support services posted the strongest wage growth at 7.5 per cent, although this was lower than the 8.7 per cent recorded a year earlier. MOM said lower-wage workers in the sector continued to benefit from policies such as the Progressive Wage Model and Local Qualifying Salary requirements.
Insurance services was one of the few sectors to buck the broader trend, with wage growth accelerating to 6.6 per cent from 4.9 per cent as firms sought to retain talent. Meanwhile, accommodation services recorded one of the sharpest slowdowns as labour demand stabilised following a post-pandemic hiring surge.
Looking ahead, MOM said wage growth is expected to remain positive but more measured amid global economic uncertainty and lingering inflation risks. Firms are likely to stay cautious when deciding on future pay increases.
