Applying Differentiated Wage Guidelines To Businesses Due To Mixed Outlook<\/strong><\/h3>\n\n\n\nSingapore\u2019s economy picked up significantly this year with Gross Domestic Product (GDP) up 4.2% in the first 3 quarters of the year. For the full year, the Ministry of Trade and Industry (MTI) projects a growth of around 3.5%, supported by a continued recovery in aviation- and tourism-related as well as consumer-facing sectors with the lifting of border and domestic restrictions.<\/p>\n\n\n\n
However, MTI notes that growth will be uneven as some sectors (outward-oriented sectors) have weakened due to softening external demand. Other downside risks in the global economy remain, such as the Russia-Ukraine conflict which could worsen global supply disruptions, intensified financial stability risks, and escalations in regional geopolitical tensions. For 2023, MTI expects Singapore\u2019s GDP growth to be at 0.5% to 2.5% due to the projected slowdown of the global economy.<\/strong><\/p>\n\n\n\nMeanwhile, Singapore\u2019s labour market improved in the first 3 quarters of 2022, supported by growth in resident employment and a slowdown in resident unemployment, Ministry of Manpower (MOM) data showed.<\/p>\n\n\n\n
However, the recent massive layoffs in the tech sector due to over hiring and weak business results are worrying some businesses.<\/p>\n\n\n\n
With such a mixed bag of growth outcomes and uncertainties, the differentiated wage guidelines for employers is a reasonable method to cater to the different performance and business outlooks expected.<\/p>\n\n\n\n
NWC\u2019s Wage Guidelines Applies To All Employees<\/strong><\/h3>\n\n\n\nThe NWC wage guidelines apply to all employees (professionals, managers, executives, technicians, rank-and-file, in unionised and non-unionised firms, in both the public and private sectors). They also apply to re-employed employees.\u00a0
Employers are called by the NWC to reward employees with wage increases or variable payments that are fair.\u00a0The adoption of the\u00a0flexible wage system (FWS)<\/a>\u00a0is a method suggested by NWC to\u00a0help employers in implementing the wage guidelines, by making full use of variable wage components. Some suggestions include putting wage increases into variable wage components, and transferring part of fixed wages to variable wage components as needed.<\/p>\n\n\n\nThe NWC noted in the wage guidelines that employees who contributed during Covid-19 should be recognised as well, especially to those employees that experienced wage cuts and freezes, and supported other cost-cutting measures.<\/p>\n\n\n\n
For Employers That Have Done Well And Have Good Prospects, Here\u2019s What You Can Do<\/strong><\/h3>\n\n\n\nFor employers that have done well and have good business prospects, they are recommended to reward their employees with built-in wage increases and variable payments to commensurate with the employers\u2019 performance and employees\u2019 contributions.<\/p>\n\n\n\n
The NWC called on these employers to reward their staff with wage increases that are fair, in line with economic growth and the improvement in labour productivity.<\/p>\n\n\n\n![\"\"](\"https:\/\/dollarsandsense.sg\/business\/wp-content\/uploads\/2022\/12\/NWC-2-1024x192.png\")
Source:\u00a0<\/em>Ministry of Manpower<\/em><\/a><\/figcaption><\/figure>\n\n\n\nThese employers should provide their lower-wage workers (LWWs) with a built-in wage increase at the upper bound of 5.5-7.5% of gross monthly wage, or a wage increase of at least $80-$100, whichever is higher.
Note: The wage guidelines for LWWs apply to employees who are earning a gross monthly wage of up to $2,200.\u00a0This threshold corresponds to the 20th\u00a0percentile wage level of the workforce, and provides the attention required for this segment of workers.<\/em><\/p>\n\n\n\nFor Employers That Have Done Well But Face Uncertain Business Prospects, Here\u2019s What You Can Do<\/strong><\/h3>\n\n\n\nEmployers in this category may exercise moderation in built-in wage increases, but should still reward employees with variable payments commensurate with the employers\u2019 performance and employees\u2019 contributions.<\/p>\n\n\n\n
The recommendation for employers in this segment is to provide their LWWs with a built-in wage increase at the lower to middle bound of 5.5-7.5% of gross monthly wage, or a wage increase of at least $80-$100, whichever is higher.<\/p>\n\n\n\n![\"\"](\"https:\/\/dollarsandsense.sg\/business\/wp-content\/uploads\/2022\/12\/NWC-3-1024x192.png\")
Source:\u00a0<\/em>Ministry of Manpower<\/em><\/a><\/figcaption><\/figure>\n\n\n\nWhat To Do If You Are An Employer Whose Business Has Not Done Well This Year<\/strong><\/h3>\n\n\n\nEmployers that have not done well may exercise wage restraint, with management leading by example, suggested NWC. Employers should also invest in upskilling their employees and make greater efforts to improve business processes and productivity.<\/p>\n\n\n\n![\"\"](\"https:\/\/dollarsandsense.sg\/business\/wp-content\/uploads\/2022\/12\/NWC-4-1024x233.png\")
Source:\u00a0<\/em>Ministry of Manpower<\/em><\/a><\/figcaption><\/figure>\n\n\n\nFor employers that have not done well but face good business prospects, the recommendation is for them to consider setting out future variable payments that are linked to appropriate business indicators.<\/p>\n\n\n\n
As for their LWWs, employers are recommended with a built-in wage increase at the lower bound of 5.5-7.5% of gross monthly wage. Further wage increases are urged, if business prospects subsequently improve. <\/p>\n\n\n\n
Read Also: <\/em><\/strong>6 Enhancements Announced In Budget 2022 That Affect Lower-Wage Workers<\/em><\/strong><\/a><\/p>\n\n\n\nShould Employers Follow NWC\u2019s Recommendations To Train And Upskill Workers?<\/strong><\/h3>\n\n\n\nData from MOM indicated that wage growth in the last 10 years have matched productivity gains.\u00a0But the NWC expressed concern that there has been a decline in employers providing structured training to employees, as the proportion of such employers fell from 65.4% in 2020 to 57.1% in 2021.<\/p>\n\n\n\n
Wage increments should go hand-in-hand with training and business transformation, as this raises productivity growth and ensures that wage growth is sustainable. According to the OECD<\/a>, raising skills is key to reconnect median wages with productivity as higher skilled workers do not head-on compete with machines.<\/p>\n\n\n\nWhen you raise the skills of workers, it will justify the increment in salaries too as the company\u2019s output increases per worker.<\/strong><\/p>\n\n\n\nTo nudge employers, some recommendations were provided by NWC to implement training and productivity initiatives:<\/p>\n\n\n\n
- Recommendations<\/strong>
- Employers can work with NTUC<\/strong> to establish Company Training Committees which will help to drive business transformation to increase productivity and implementing training plans, and can tap into the wider NTUC training and placement ecosystem, which includes NTUC\u2019s\u00a0employment and employability institute e2i<\/a>.
<\/li><\/ul>- Employers should adopt a proactive approach<\/strong> to reskill and upskill existing employees to prepare them for changes in job functions. Employers and employees can refer to\u00a0SkillsFuture Singapore\u2019s quarterly Jobs and Skills Insights Reports<\/a>, as well as the\u00a0Skills Demand for the Future Economy report<\/a> published in December 2021\u00a0to learn about emerging trends, growth areas and in-demand skills.\u00a0
<\/li>- Employers can also tap on government subsidies<\/strong> to reskill and upskill employees, e.g.,\u00a0Workforce Singapore\u2019s Career Conversion Programmes<\/a>\u00a0which provide up to 90% of monthly salary\u00a0for training duration. Individuals can also tap on the SkillsFuture Mid-Career Enhanced Subsidy, which provides subsidies of up to 90% of course fees\u00a0for SSG-supported courses.\u00a0
<\/li>- Employers can also seek the assistance of SNEF, Singapore Business Federation, other trade associations & chambers<\/strong>, the unions and NTUC LearningHub, access consultancy services offered by the National Centre of Excellence for Workplace Learning, or join a SkillsFuture Queen Bee network in their sector to raise their capability and capacity for training their own workers.\u00a0
<\/li>- Employers should also recognise and support the acquisition and demonstration of skills<\/strong> in decisions affecting hiring and career advancements.\u00a0<\/li><\/ul><\/li><\/ul>\n\n\n\n
Other than these top down efforts, employers can keep their workers relevant by looking for industry-related\u00a0courses, or set a career plan for their workers so they can upgrade progressively in their careers.<\/p>\n\n\n\n
What To Do If You (The Employer) Have Difficulties In Implementing The Wage Guidelines<\/strong><\/h3>\n\n\n\nIf you are facing difficulties in implementing NWC\u2019s guidelines, you can work with employers\u2019 associations and unions to address the issues that you face. You can also approach ethnic chambers and trade associations for guidance if required.<\/p>\n\n\n\n
As employers, you may question why you should increase the salaries of your employees regardless of the state of your business condition. One can justify that when you raise the salaries of your workers, it brings about meaningful improvement to their income stability in the long run and that leads to a contented worker who wants to work hard for the company.<\/p>\n\n\n\n
When increments are made especially to peg with inflation, employees will also be more satisfied with their work and will not go looking around for a new job just for a pay jump<\/strong> as the current employer is already providing an increment.<\/p>\n\n\n\nIt is fair to increase wages to match the industry average too, as that helps attract and retain talent in your company. You will also get better online anonymous employee reviews (like those on Glassdoor), which will lead to a continuous cycle of talents wanting to join your company.<\/p>\n\n\n\n
As for raising the salaries of LWWs, consider it as your contribution to maintain a strong social compact as Singapore progresses. NWC’s recommended wage growth for these workers is, according to them, supposed to balance business sustainability and bolster ongoing efforts to narrow the income gap.<\/p>\n\n\n\n
Meanwhile, Singapore\u2019s labour market improved in the first 3 quarters of 2022, supported by growth in resident employment and a slowdown in resident unemployment, Ministry of Manpower (MOM) data showed.<\/p>\n\n\n\n
However, the recent massive layoffs in the tech sector due to over hiring and weak business results are worrying some businesses.<\/p>\n\n\n\n
With such a mixed bag of growth outcomes and uncertainties, the differentiated wage guidelines for employers is a reasonable method to cater to the different performance and business outlooks expected.<\/p>\n\n\n\n
NWC\u2019s Wage Guidelines Applies To All Employees<\/strong><\/h3>\n\n\n\nThe NWC wage guidelines apply to all employees (professionals, managers, executives, technicians, rank-and-file, in unionised and non-unionised firms, in both the public and private sectors). They also apply to re-employed employees.\u00a0
Employers are called by the NWC to reward employees with wage increases or variable payments that are fair.\u00a0The adoption of the\u00a0flexible wage system (FWS)<\/a>\u00a0is a method suggested by NWC to\u00a0help employers in implementing the wage guidelines, by making full use of variable wage components. Some suggestions include putting wage increases into variable wage components, and transferring part of fixed wages to variable wage components as needed.<\/p>\n\n\n\nThe NWC noted in the wage guidelines that employees who contributed during Covid-19 should be recognised as well, especially to those employees that experienced wage cuts and freezes, and supported other cost-cutting measures.<\/p>\n\n\n\n
For Employers That Have Done Well And Have Good Prospects, Here\u2019s What You Can Do<\/strong><\/h3>\n\n\n\nFor employers that have done well and have good business prospects, they are recommended to reward their employees with built-in wage increases and variable payments to commensurate with the employers\u2019 performance and employees\u2019 contributions.<\/p>\n\n\n\n
The NWC called on these employers to reward their staff with wage increases that are fair, in line with economic growth and the improvement in labour productivity.<\/p>\n\n\n\nSource:\u00a0<\/em>Ministry of Manpower<\/em><\/a><\/figcaption><\/figure>\n\n\n\nThese employers should provide their lower-wage workers (LWWs) with a built-in wage increase at the upper bound of 5.5-7.5% of gross monthly wage, or a wage increase of at least $80-$100, whichever is higher.
Note: The wage guidelines for LWWs apply to employees who are earning a gross monthly wage of up to $2,200.\u00a0This threshold corresponds to the 20th\u00a0percentile wage level of the workforce, and provides the attention required for this segment of workers.<\/em><\/p>\n\n\n\nFor Employers That Have Done Well But Face Uncertain Business Prospects, Here\u2019s What You Can Do<\/strong><\/h3>\n\n\n\nEmployers in this category may exercise moderation in built-in wage increases, but should still reward employees with variable payments commensurate with the employers\u2019 performance and employees\u2019 contributions.<\/p>\n\n\n\n
The recommendation for employers in this segment is to provide their LWWs with a built-in wage increase at the lower to middle bound of 5.5-7.5% of gross monthly wage, or a wage increase of at least $80-$100, whichever is higher.<\/p>\n\n\n\nSource:\u00a0<\/em>Ministry of Manpower<\/em><\/a><\/figcaption><\/figure>\n\n\n\nWhat To Do If You Are An Employer Whose Business Has Not Done Well This Year<\/strong><\/h3>\n\n\n\nEmployers that have not done well may exercise wage restraint, with management leading by example, suggested NWC. Employers should also invest in upskilling their employees and make greater efforts to improve business processes and productivity.<\/p>\n\n\n\nSource:\u00a0<\/em>Ministry of Manpower<\/em><\/a><\/figcaption><\/figure>\n\n\n\nFor employers that have not done well but face good business prospects, the recommendation is for them to consider setting out future variable payments that are linked to appropriate business indicators.<\/p>\n\n\n\n
As for their LWWs, employers are recommended with a built-in wage increase at the lower bound of 5.5-7.5% of gross monthly wage. Further wage increases are urged, if business prospects subsequently improve. <\/p>\n\n\n\n
Read Also: <\/em><\/strong>6 Enhancements Announced In Budget 2022 That Affect Lower-Wage Workers<\/em><\/strong><\/a><\/p>\n\n\n\nShould Employers Follow NWC\u2019s Recommendations To Train And Upskill Workers?<\/strong><\/h3>\n\n\n\nData from MOM indicated that wage growth in the last 10 years have matched productivity gains.\u00a0But the NWC expressed concern that there has been a decline in employers providing structured training to employees, as the proportion of such employers fell from 65.4% in 2020 to 57.1% in 2021.<\/p>\n\n\n\n
Wage increments should go hand-in-hand with training and business transformation, as this raises productivity growth and ensures that wage growth is sustainable. According to the OECD<\/a>, raising skills is key to reconnect median wages with productivity as higher skilled workers do not head-on compete with machines.<\/p>\n\n\n\nWhen you raise the skills of workers, it will justify the increment in salaries too as the company\u2019s output increases per worker.<\/strong><\/p>\n\n\n\nTo nudge employers, some recommendations were provided by NWC to implement training and productivity initiatives:<\/p>\n\n\n\n
- Recommendations<\/strong>
- Employers can work with NTUC<\/strong> to establish Company Training Committees which will help to drive business transformation to increase productivity and implementing training plans, and can tap into the wider NTUC training and placement ecosystem, which includes NTUC\u2019s\u00a0employment and employability institute e2i<\/a>.
<\/li><\/ul>- Employers should adopt a proactive approach<\/strong> to reskill and upskill existing employees to prepare them for changes in job functions. Employers and employees can refer to\u00a0SkillsFuture Singapore\u2019s quarterly Jobs and Skills Insights Reports<\/a>, as well as the\u00a0Skills Demand for the Future Economy report<\/a> published in December 2021\u00a0to learn about emerging trends, growth areas and in-demand skills.\u00a0
<\/li>- Employers can also tap on government subsidies<\/strong> to reskill and upskill employees, e.g.,\u00a0Workforce Singapore\u2019s Career Conversion Programmes<\/a>\u00a0which provide up to 90% of monthly salary\u00a0for training duration. Individuals can also tap on the SkillsFuture Mid-Career Enhanced Subsidy, which provides subsidies of up to 90% of course fees\u00a0for SSG-supported courses.\u00a0
<\/li>- Employers can also seek the assistance of SNEF, Singapore Business Federation, other trade associations & chambers<\/strong>, the unions and NTUC LearningHub, access consultancy services offered by the National Centre of Excellence for Workplace Learning, or join a SkillsFuture Queen Bee network in their sector to raise their capability and capacity for training their own workers.\u00a0
<\/li>- Employers should also recognise and support the acquisition and demonstration of skills<\/strong> in decisions affecting hiring and career advancements.\u00a0<\/li><\/ul><\/li><\/ul>\n\n\n\n
Other than these top down efforts, employers can keep their workers relevant by looking for industry-related\u00a0courses, or set a career plan for their workers so they can upgrade progressively in their careers.<\/p>\n\n\n\n
What To Do If You (The Employer) Have Difficulties In Implementing The Wage Guidelines<\/strong><\/h3>\n\n\n\nIf you are facing difficulties in implementing NWC\u2019s guidelines, you can work with employers\u2019 associations and unions to address the issues that you face. You can also approach ethnic chambers and trade associations for guidance if required.<\/p>\n\n\n\n
As employers, you may question why you should increase the salaries of your employees regardless of the state of your business condition. One can justify that when you raise the salaries of your workers, it brings about meaningful improvement to their income stability in the long run and that leads to a contented worker who wants to work hard for the company.<\/p>\n\n\n\n
When increments are made especially to peg with inflation, employees will also be more satisfied with their work and will not go looking around for a new job just for a pay jump<\/strong> as the current employer is already providing an increment.<\/p>\n\n\n\nIt is fair to increase wages to match the industry average too, as that helps attract and retain talent in your company. You will also get better online anonymous employee reviews (like those on Glassdoor), which will lead to a continuous cycle of talents wanting to join your company.<\/p>\n\n\n\n
As for raising the salaries of LWWs, consider it as your contribution to maintain a strong social compact as Singapore progresses. NWC’s recommended wage growth for these workers is, according to them, supposed to balance business sustainability and bolster ongoing efforts to narrow the income gap.<\/p>\n\n\n\n
Employers are called by the NWC to reward employees with wage increases or variable payments that are fair.\u00a0The adoption of the\u00a0flexible wage system (FWS)<\/a>\u00a0is a method suggested by NWC to\u00a0help employers in implementing the wage guidelines, by making full use of variable wage components. Some suggestions include putting wage increases into variable wage components, and transferring part of fixed wages to variable wage components as needed.<\/p>\n\n\n\n
The NWC noted in the wage guidelines that employees who contributed during Covid-19 should be recognised as well, especially to those employees that experienced wage cuts and freezes, and supported other cost-cutting measures.<\/p>\n\n\n\n
For Employers That Have Done Well And Have Good Prospects, Here\u2019s What You Can Do<\/strong><\/h3>\n\n\n\nFor employers that have done well and have good business prospects, they are recommended to reward their employees with built-in wage increases and variable payments to commensurate with the employers\u2019 performance and employees\u2019 contributions.<\/p>\n\n\n\n
The NWC called on these employers to reward their staff with wage increases that are fair, in line with economic growth and the improvement in labour productivity.<\/p>\n\n\n\nSource:\u00a0<\/em>Ministry of Manpower<\/em><\/a><\/figcaption><\/figure>\n\n\n\nThese employers should provide their lower-wage workers (LWWs) with a built-in wage increase at the upper bound of 5.5-7.5% of gross monthly wage, or a wage increase of at least $80-$100, whichever is higher.
Note: The wage guidelines for LWWs apply to employees who are earning a gross monthly wage of up to $2,200.\u00a0This threshold corresponds to the 20th\u00a0percentile wage level of the workforce, and provides the attention required for this segment of workers.<\/em><\/p>\n\n\n\nFor Employers That Have Done Well But Face Uncertain Business Prospects, Here\u2019s What You Can Do<\/strong><\/h3>\n\n\n\nEmployers in this category may exercise moderation in built-in wage increases, but should still reward employees with variable payments commensurate with the employers\u2019 performance and employees\u2019 contributions.<\/p>\n\n\n\n
The recommendation for employers in this segment is to provide their LWWs with a built-in wage increase at the lower to middle bound of 5.5-7.5% of gross monthly wage, or a wage increase of at least $80-$100, whichever is higher.<\/p>\n\n\n\nSource:\u00a0<\/em>Ministry of Manpower<\/em><\/a><\/figcaption><\/figure>\n\n\n\nWhat To Do If You Are An Employer Whose Business Has Not Done Well This Year<\/strong><\/h3>\n\n\n\nEmployers that have not done well may exercise wage restraint, with management leading by example, suggested NWC. Employers should also invest in upskilling their employees and make greater efforts to improve business processes and productivity.<\/p>\n\n\n\nSource:\u00a0<\/em>Ministry of Manpower<\/em><\/a><\/figcaption><\/figure>\n\n\n\nFor employers that have not done well but face good business prospects, the recommendation is for them to consider setting out future variable payments that are linked to appropriate business indicators.<\/p>\n\n\n\n
As for their LWWs, employers are recommended with a built-in wage increase at the lower bound of 5.5-7.5% of gross monthly wage. Further wage increases are urged, if business prospects subsequently improve. <\/p>\n\n\n\n
Read Also: <\/em><\/strong>6 Enhancements Announced In Budget 2022 That Affect Lower-Wage Workers<\/em><\/strong><\/a><\/p>\n\n\n\nShould Employers Follow NWC\u2019s Recommendations To Train And Upskill Workers?<\/strong><\/h3>\n\n\n\nData from MOM indicated that wage growth in the last 10 years have matched productivity gains.\u00a0But the NWC expressed concern that there has been a decline in employers providing structured training to employees, as the proportion of such employers fell from 65.4% in 2020 to 57.1% in 2021.<\/p>\n\n\n\n
Wage increments should go hand-in-hand with training and business transformation, as this raises productivity growth and ensures that wage growth is sustainable. According to the OECD<\/a>, raising skills is key to reconnect median wages with productivity as higher skilled workers do not head-on compete with machines.<\/p>\n\n\n\nWhen you raise the skills of workers, it will justify the increment in salaries too as the company\u2019s output increases per worker.<\/strong><\/p>\n\n\n\nTo nudge employers, some recommendations were provided by NWC to implement training and productivity initiatives:<\/p>\n\n\n\n
- Recommendations<\/strong>
- Employers can work with NTUC<\/strong> to establish Company Training Committees which will help to drive business transformation to increase productivity and implementing training plans, and can tap into the wider NTUC training and placement ecosystem, which includes NTUC\u2019s\u00a0employment and employability institute e2i<\/a>.
<\/li><\/ul>- Employers should adopt a proactive approach<\/strong> to reskill and upskill existing employees to prepare them for changes in job functions. Employers and employees can refer to\u00a0SkillsFuture Singapore\u2019s quarterly Jobs and Skills Insights Reports<\/a>, as well as the\u00a0Skills Demand for the Future Economy report<\/a> published in December 2021\u00a0to learn about emerging trends, growth areas and in-demand skills.\u00a0
<\/li>- Employers can also tap on government subsidies<\/strong> to reskill and upskill employees, e.g.,\u00a0Workforce Singapore\u2019s Career Conversion Programmes<\/a>\u00a0which provide up to 90% of monthly salary\u00a0for training duration. Individuals can also tap on the SkillsFuture Mid-Career Enhanced Subsidy, which provides subsidies of up to 90% of course fees\u00a0for SSG-supported courses.\u00a0
<\/li>- Employers can also seek the assistance of SNEF, Singapore Business Federation, other trade associations & chambers<\/strong>, the unions and NTUC LearningHub, access consultancy services offered by the National Centre of Excellence for Workplace Learning, or join a SkillsFuture Queen Bee network in their sector to raise their capability and capacity for training their own workers.\u00a0
<\/li>- Employers should also recognise and support the acquisition and demonstration of skills<\/strong> in decisions affecting hiring and career advancements.\u00a0<\/li><\/ul><\/li><\/ul>\n\n\n\n
Other than these top down efforts, employers can keep their workers relevant by looking for industry-related\u00a0courses, or set a career plan for their workers so they can upgrade progressively in their careers.<\/p>\n\n\n\n
What To Do If You (The Employer) Have Difficulties In Implementing The Wage Guidelines<\/strong><\/h3>\n\n\n\nIf you are facing difficulties in implementing NWC\u2019s guidelines, you can work with employers\u2019 associations and unions to address the issues that you face. You can also approach ethnic chambers and trade associations for guidance if required.<\/p>\n\n\n\n
As employers, you may question why you should increase the salaries of your employees regardless of the state of your business condition. One can justify that when you raise the salaries of your workers, it brings about meaningful improvement to their income stability in the long run and that leads to a contented worker who wants to work hard for the company.<\/p>\n\n\n\n
When increments are made especially to peg with inflation, employees will also be more satisfied with their work and will not go looking around for a new job just for a pay jump<\/strong> as the current employer is already providing an increment.<\/p>\n\n\n\nIt is fair to increase wages to match the industry average too, as that helps attract and retain talent in your company. You will also get better online anonymous employee reviews (like those on Glassdoor), which will lead to a continuous cycle of talents wanting to join your company.<\/p>\n\n\n\n
As for raising the salaries of LWWs, consider it as your contribution to maintain a strong social compact as Singapore progresses. NWC’s recommended wage growth for these workers is, according to them, supposed to balance business sustainability and bolster ongoing efforts to narrow the income gap.<\/p>\n\n\n\n
These employers should provide their lower-wage workers (LWWs) with a built-in wage increase at the upper bound of 5.5-7.5% of gross monthly wage, or a wage increase of at least $80-$100, whichever is higher. Employers in this category may exercise moderation in built-in wage increases, but should still reward employees with variable payments commensurate with the employers\u2019 performance and employees\u2019 contributions.<\/p>\n\n\n\n The recommendation for employers in this segment is to provide their LWWs with a built-in wage increase at the lower to middle bound of 5.5-7.5% of gross monthly wage, or a wage increase of at least $80-$100, whichever is higher.<\/p>\n\n\n\n Employers that have not done well may exercise wage restraint, with management leading by example, suggested NWC. Employers should also invest in upskilling their employees and make greater efforts to improve business processes and productivity.<\/p>\n\n\n\n For employers that have not done well but face good business prospects, the recommendation is for them to consider setting out future variable payments that are linked to appropriate business indicators.<\/p>\n\n\n\n As for their LWWs, employers are recommended with a built-in wage increase at the lower bound of 5.5-7.5% of gross monthly wage. Further wage increases are urged, if business prospects subsequently improve. <\/p>\n\n\n\n Read Also: <\/em><\/strong>6 Enhancements Announced In Budget 2022 That Affect Lower-Wage Workers<\/em><\/strong><\/a><\/p>\n\n\n\n Data from MOM indicated that wage growth in the last 10 years have matched productivity gains.\u00a0But the NWC expressed concern that there has been a decline in employers providing structured training to employees, as the proportion of such employers fell from 65.4% in 2020 to 57.1% in 2021.<\/p>\n\n\n\n Wage increments should go hand-in-hand with training and business transformation, as this raises productivity growth and ensures that wage growth is sustainable. According to the OECD<\/a>, raising skills is key to reconnect median wages with productivity as higher skilled workers do not head-on compete with machines.<\/p>\n\n\n\n When you raise the skills of workers, it will justify the increment in salaries too as the company\u2019s output increases per worker.<\/strong><\/p>\n\n\n\n To nudge employers, some recommendations were provided by NWC to implement training and productivity initiatives:<\/p>\n\n\n\n Other than these top down efforts, employers can keep their workers relevant by looking for industry-related\u00a0courses, or set a career plan for their workers so they can upgrade progressively in their careers.<\/p>\n\n\n\n If you are facing difficulties in implementing NWC\u2019s guidelines, you can work with employers\u2019 associations and unions to address the issues that you face. You can also approach ethnic chambers and trade associations for guidance if required.<\/p>\n\n\n\n As employers, you may question why you should increase the salaries of your employees regardless of the state of your business condition. One can justify that when you raise the salaries of your workers, it brings about meaningful improvement to their income stability in the long run and that leads to a contented worker who wants to work hard for the company.<\/p>\n\n\n\n When increments are made especially to peg with inflation, employees will also be more satisfied with their work and will not go looking around for a new job just for a pay jump<\/strong> as the current employer is already providing an increment.<\/p>\n\n\n\n It is fair to increase wages to match the industry average too, as that helps attract and retain talent in your company. You will also get better online anonymous employee reviews (like those on Glassdoor), which will lead to a continuous cycle of talents wanting to join your company.<\/p>\n\n\n\n As for raising the salaries of LWWs, consider it as your contribution to maintain a strong social compact as Singapore progresses. NWC’s recommended wage growth for these workers is, according to them, supposed to balance business sustainability and bolster ongoing efforts to narrow the income gap.<\/p>\n\n\n\n
Note: The wage guidelines for LWWs apply to employees who are earning a gross monthly wage of up to $2,200.\u00a0This threshold corresponds to the 20th\u00a0percentile wage level of the workforce, and provides the attention required for this segment of workers.<\/em><\/p>\n\n\n\nFor Employers That Have Done Well But Face Uncertain Business Prospects, Here\u2019s What You Can Do<\/strong><\/h3>\n\n\n\n
What To Do If You Are An Employer Whose Business Has Not Done Well This Year<\/strong><\/h3>\n\n\n\n
Should Employers Follow NWC\u2019s Recommendations To Train And Upskill Workers?<\/strong><\/h3>\n\n\n\n
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<\/li>What To Do If You (The Employer) Have Difficulties In Implementing The Wage Guidelines<\/strong><\/h3>\n\n\n\n