S'pore real wages up in 2025, workers’ purchasing power strengthened: MOM

Wages in Singapore continued to grow in 2025, as real wage growth improved over the year and strengthened workers’ purchasing power, the Ministry of Manpower (MOM) said on May 28.

This occurred alongside an increase in the proportion of profitable establishments.

Real wage growth is expected to remain positive in 2026, although firms are expected to remain measured in their wage increases amid geopolitical uncertainties and inflationary pressures, MOM added.

Wage growth broadly in line with past years

Nominal total wages, which include employer Central Provident Fund (CPF) contributions of full-time resident employees who had been with the same employer for at least one year, continued to grow by 4.9 per cent in 2025.

Wage growth remained broadly in line with past years, even though this was a moderation from 2024, when wage growth was 5.6 per cent.

The moderation coincided with easing inflation, MOM said, which may have reduced upward pressure on firms to raise nominal wages.

After accounting for inflation, real wages grew by 4 per cent in 2025, higher than the 3.2 per cent growth in 2024.

This indicated improved purchasing power for workers.

"Over the medium term, real wage growth continues to be supported by real productivity growth," MOM said.

Majority of businesses reported they were profitable

Some 83.1 per cent of establishments reported that they were profitable in 2025, up from 80.8 per cent in 2024.

"This reflected a relatively favourable business conditions amid Singapore’s continued economic growth," MOM said.

Some 64.1 per cent of firms reported stable or improved profitability at levels — 62.7 per cent — similar to 2024.

This suggested a growing share of financially stable firms, MOM said.

The proportion of firms — 16.9 per cent — that reported a loss in 2025, had declined from 2024, when it was 19.2 per cent.

Smaller firms, which run on a smaller scale and produce less, were more likely to report losses compared to larger firms, MOM said.

More companies kept wages unchanged

While establishments granting wage increases continued to form the majority in 2025 at 72.4 per cent, the proportion doing so declined from 2024, when it was 78.3 per cent.

More companies kept wages unchanged — from 18.5 per cent in 2024 to 24.5 per cent in 2025.

Among establishments that provided increases, wage increments averaged 5.8 per cent in 2025, with employee retention remaining the most commonly cited reason for granting wage increases.

Only a small percentage — 3.1 per cent — of firms reduced wages, with an average wage reduction of 3.7 per cent in 2025.

These firms generally experienced weaker business performance than in the previous year, leading some to implement wage cuts, according to MOM.

Wage growth of different employee groups narrowed

Rank-and-File, junior and senior management employees all experienced positive but moderated wage growth in 2025 at 4.8 per cent, 5.1 per cent and 4.9 per cent, respectively.

More broad-based wage gains occurred, as differences in wage growth across employee groups narrowed in 2025.

Wage growth strong among some sectors

Wage growth remained positive across all sectors in 2025, although most sectors recorded slower wage growth compared to 2024, a sign wage momentum had eased amid a more cautious business environment.

Administrative and support services recorded the highest wage growth at 7.5 per cent, although this was below the 8.7 per cent growth in 2024.

Lower-wage workers in the sector were supported by the wage ladders under the progressive wage model (PWM) and the local qualifying salary requirements.

Amid continued demand for professionals, managers and executives, financial services registered 5.9 per cent wage growth, and insurance services achieved 6.6 per cent wage growth.

Wage growth moderation in accommodation sector

On the other hand, accommodation recorded the largest moderation in wage growth.

It eased from 5.5 per cent in 2024 to 3.9 per cent in 2025 as "labour demand stabilised" in the wake of the hiring surge during the post-pandemic recovery period from 2022 and 2023.

The construction sector also recorded more notable moderation in wage growth compared to the previous year, easing from 5.5 per cent in 2024 to 4.0 per cent in 2025.

MOM said the government encourages establishments to adopt the Flexible Wage System, which enables quick, temporary adjustments during downturns, allowing establishments to cut costs rather than jobs to sustain their businesses.

The government also encourages establishments to provide fair and sustainable wage increases aligned with productivity growth, in line with the current National Wages Council guidelines.

The full 2025 report is available online.