Real incomes rebounded in 2024 after declining the year before, MOM says

SINGAPORE: As wages increased and inflation eased, real incomes for Singapore residents rose in 2024, the Manpower Ministry said on Thursday (Nov 28).
Real incomes take inflation into account, and measure the purchasing power of an individual.
Nominal incomes increased at a faster pace this year compared with last year, with the nominal median gross monthly income increasing from S$5,197 (US$3,880) to S$5,500, the Ministry of Manpower (MOM) said in an advance release of its labour force report.
That is a 5.8 per cent increase, up from 2.5 per cent growth last year.
At the 20th percentile – the lower end of the income scale – nominal income stood at S$3,026, a 7.1 per cent increase from S$2,826. From 2022 to 2023, nominal income grew only 1.7 per cent.
The increase in nominal income coupled with easing inflation means real incomes grew in 2024, said MOM.
For employees at the 20th percentile, real incomes grew 4.6 per cent after shrinking 3 per cent in 2023. Median real incomes grew 3.4 per cent after contracting 2.2 per cent last year.
“In fact, I think we see a broad-based increase across all deciles, so it’s not just these two groups that we are focusing on,” said Mr Ang Boon Heng, director of the manpower research and statistics department.
“The real income growth in 2024 was close to the average growth rates seen in the years preceding COVID-19 … when inflation was lower,” the report said.
The ministry noted that income growth at the 20th percentile was higher than for median income earners. Mr Ang said that means income inequality is narrowing.
“This was supported by initiatives that aim to uplift lower-wage workers, such as the (Progressive Wage Model) and the National Wage Council’s recommendation on the quantum of wage increase for lower-wage workers.”
It added that lower-wage workers can expect to see greater income increases in the coming years, and noted that productivity is still outpacing wage increases.
MOM also highlighted that the majority of workers between 25 and 64 years old who transitioned to different industries saw an increase in income.
That suggests that changing industries led to “positive employment outcomes”.
“They were generally hired into higher-skilled positions in more productive sectors,” the report said, pointing to financial and insurance services, information and communications and professional services. Over the past ten years, more residents have moved into those sectors.
Nearly 60 per cent of 2024’s industry switchers earned at least 5 per cent more after accounting for inflation, and around 20 per cent earned around the same amount.
The remaining 20 per cent saw their real income decline by at least 5 per cent.