Lower-wage workers should get 5.5% to 7.5% wage increase: National Wages Council

The National Wages Council (NWC) has advised employers in Singapore to provide lower-wage workers with a built-in wage increase of 5.5 per cent to 7.5 per cent of their monthly gross wage, or a wage increase of at least S$105 to S$125, whichever is higher.

This recommendation applies to all employees earning a gross monthly wage (before CPF) of up to S$2,700.

However this is only if they have "done well" or have "positive business prospects" this year.

Alternatives

For employers who have done well but face "uncertain prospects", the NWC recommends they should provide their lower-wage workers with a built-in wage increase at the middle to lower end of 5.5 to 7.5 per cent of gross monthly wage, or a wage increase of at least S$105 to S$125, whichever is higher.

For employers who have not done well, they should provide their lower-wage workers with a built-in wage increase at the lower end of 5.5 to 7.5 per cent of gross monthly wage.

If business prospects subsequently improve, employers should consider further wage increases.

Baseline wages for admin staff, drivers

NWC, which convened from September to October to formulate its 2025/2026 wage guidelines, published its recommendations in a Nov. 11 report.

The NWC 2025/2026 guidelines have received the support of tripartite partners — the Singapore government, the Singapore National Employers Federation (SNEF) and the National Trades Union Congress (NTUC).

Its guidelines recommend employers to use Occupational Progressive Wage (OPW) requirements for administrators and drivers, including job ladders, job descriptions and wage requirements, that will come into effect in July 2026.

The OPW requirements recommend that administrative assistants and drivers working full-time should receive a baseline monthly wage of S$2,170 and S$2,370 respectively.

From July 2027, the baseline monthly wage requirement is increased to S$2,360 and S$2,550 respectively.

Wage flexibility

The NWC guidelines also encourage employers to adopt the Flexible Wage System (FWS) in full, which has a sizeable variable component that can be adjusted quickly by employers during difficult periods, to cut costs rather than retrench workers.

This comes as the Ministry of Trade and Industry (MTI) has projected that the Singapore economy will expand by 1.5 per cent to 2.5 per cent in 2025, down from 4.4 per cent in 2024.

NWC noted that Singapore’s economic outlook for the rest of the year remains clouded by uncertainty, with Singapore's Gross Domestic Product (GDP) growth expected to continue to slow on the back of a further moderation in the growth of outward-oriented sectors.

And in 2026, Singapore’s GDP growth is likely to be weighed down by weak global demand owing to the effects of the U.S. tariffs on global growth and trade, NWC said.

"The NWC acknowledges the near-term cost pressures faced by businesses, as well as the additional uncertainty and downside risks in the global economy arising from the U.S. tariffs and other countries’ responses to the tariffs. This underscores the need for wage flexibility," the report read.

Meanwhile, NWC advised employers who have done well and have positive business prospects to reward employees with built-in wage increases and variable payments commensurate with employers' performance and employees' contributions.

Future guidelines will support flexible work arrangements

NWC urged employers to press on with efforts with enterprise and workforce transformation, including reskilling and upskilling their workforce and strengthening their human resource capabilities.

NWC also noted that Singapore’s workforce is rapidly ageing and work patterns are becoming more diverse.

Thus, it will be exploring ways to better reflect skills, contributions and varying workloads in its future guidelines, in order to support longer careers and accommodate more flexible work arrangements.

NWC aims to complete this review by 2026.

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