It’s a good time to be a full-time employee in Singapore—or so one might think.
Whether you are a young fresh graduate embarking on your first job, or an older, experienced worker with a decade or more of experience, employees in Singapore today are enjoying a work-life balance and options that previous generations would envy.
As our article earlier this month highlighted, workers in Singapore are working fewer hours than they have in the past decade, with average working hours dropping below 44 hours a week in 2023 (43.6 hours). At the same time, the median salary has started to rise again and currently stands at $5,197 per month (inclusive of CPF contributions) after remaining stagnant from 2018 to 2021.
Source: MOM
Beyond simply earning a higher salary while working fewer hours, Singapore continues to benefit from a low unemployment rate, which stood at just 1.9% in 2023. This figure is notably low compared to previous years when the unemployment rate generally exceeded 2.0%.
Source: MOM
In an announcement that will likely please Singaporean workers (while simultaneously posing challenges for employers and HR managers), the Tripartite Alliance for Fair & Progressive Employment Practices (TAFEP) has launched new guidelines to support flexible work arrangements (FWAs).
From 1 December 2024, employers are expected to implement a process to manage FWA requests. This does not mean that employers must agree to all FWA requests; rather, each request must be fairly evaluated by the company and either granted or rejected based on business grounds.
Read Also: Guide To Creating A Flexible Work Arrangements Framework For Your Company
Outside of Singapore, many young workers in major Asian economies are facing tougher conditions. South Korea’s jobless rate has risen to 2.8%, with many young and educated individuals struggling to find employment. Samsung, one of Korea’s largest companies, has adopted a different strategy by implementing a six-day work week for executives in an effort to avert corporate crises and drive productivity.
Meanwhile, youth unemployment in China remains a significant issue; the unemployment rate for young people aged 16 to 24 in the world’s second-largest economy stood at 14.9% in December 2023.
The Threats To Singapore Workers
For Singaporean workers, the high salary, low unemployment rate, and improved work-life balance are undoubtedly significant benefits. However, there are areas of concern that require attention.
Singapore’s Rising Cost of Operation
Singapore is experiencing an increase in operational costs for businesses as the economy slows down, primarily due to two factors: rising office rents and a tight labour market. Office spaces, especially in prime locations, are becoming increasingly expensive. Simultaneously, the labour market is constrained by low unemployment and limited immigration, driving wages up as companies compete for scarce talent.
The danger here is that companies, particularly foreign ones, may opt to relocate their operations overseas if they find Singapore too expensive. There is no shortage of countries around Singapore where operating costs are lower, although these companies would need to ensure they continue to have access to the talent required to remain competitive.
Remote Work: A Double-Edged Sword
While the ability to formally request and enjoy flexible work arrangements, including remote working, is advantageous, Singapore workers must consider that remote work is a double-edged sword, especially when they are based in Singapore, which is one of the world’s most expensive cities to live in.
One of the main advantages a Singaporean worker has over cheaper remote workers based overseas is that many employers still value face-to-face human interaction, even in jobs where physical presence in the office isn’t always essential.
However, as more Singapore companies embrace hybrid/remote work models, it will become increasingly easier for them to collaborate with talents across the globe remotely. Since many of these countries where remote workers are based tend to have a lower cost of living, their salary expectations will be lower.
Even if Singaporean workers are better qualified and more efficient, the reality remains that a Singaporean worker who is paid three times more than his foreign counterpart and delivers 30% more output might not necessarily be seen as a value-for-money hire. This economic comparison could influence employers’ hiring decisions, especially in a globally competitive market.
Read Also: Working From Anywhere: Things You Need To Know Before Working Remotely Overseas
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