SINGAPORE – Workers in Singapore saw their spending power improve in 2025 as wages rose while inflation eased, according to the Ministry of Manpower (MOM).
Nominal wages – including employer CPF contributions – rose 4.9 per cent in 2025, slower than the 5.6 per cent recorded in 2024.
But after adjusting for inflation, real wages grew by 4 per cent, up from 3.2 per cent the year before. This means workers generally had higher purchasing power, according to a MOM report on wage practices released on May 28.
Overall inflation averaged 0.9 per cent in 2025, a big drop from 2.4 per cent in 2024, according to official data.
While most establishments continued to raise wages in 2025, the proportion fell to 72.4 per cent from 78.3 per cent in 2024. More firms also kept wages unchanged, with the share rising from 18.5 per cent to 24.5 per cent.
Among those that granted pay hike, employee retention was the most commonly cited reason.
Only 3.1 per cent of the firms surveyed cut wages in 2025, down slightly from 3.2 per cent in 2024.
MOM polled some 6,236 firms in the private sector with at least 10 employees for this report. The findings reflect the wages of over 1 million employees.
“Looking ahead, wage growth is expected to remain positive but moderated amid a more uncertain global environment and inflation risks. Firms are likely to be measured in wage increases,” MOM said.
In 2025, 83.1 per cent of business establishments were profitable, up from 80.8 per cent in 2024.
Meanwhile, 64.1 per cent of firms reported profitability that was stable or better than the previous year, higher than the 62.7 per cent recorded in 2024, suggesting a growing share of financially stable firms, MOM said.
In 2025, rank-and-file workers recorded wage growth of 4.8 per cent, while junior management and senior management employees saw growth of 5.1 per cent and 4.9 per cent.
This was lower than in 2024, when wage growth for rank-and-file workers and junior management employees came in at 5.8 per cent and 5.6 per cent respectively, while senior management employees recorded 5.1 per cent growth.
Wage growth remained positive across all sectors in 2025, although most recorded slower growth than in 2024 amid a more cautious business environment.
Administrative and support services posted the highest wage growth at 7.5 per cent, though this was lower than the 8.7 per cent growth recorded in 2024.
MOM noted that lower-wage workers in the sector continued to be supported by wage ladders under the Progressive Wage Model and Local Qualifying Salary requirements.
Financial services recorded slower wage growth of 5.9 per cent in 2025, down from 6.7 per cent in 2024.
Accommodation recorded the largest moderation in wage growth, easing from 5.5 per cent in 2024 to 3.9 per cent in 2025 as labour demand stabilised following the hiring surge during the post-pandemic recovery period from 2022 and 2023.
Construction was another sector that recorded more notable moderation in wage growth compared to the previous year, easing from 5.5 per cent in 2024 to 4 per cent in 2025.
By contrast, insurance services and wholesale trade were the only two sectors to record stronger wage growth in 2025. Insurance services saw wage growth rise from 4.9 per cent in 2024 to 6.6 per cent in 2025, while wholesale trade edged up from 4.2 per cent to 4.4 per cent.
MOM said the stronger wage growth in these sectors was driven by the need to retain employees.
“Looking ahead, wage growth is expected to remain positive but moderated amid a more uncertain global environment and inflation risks. Firms are likely to be measured in wage increases,” MOM said.
