Average Salary in Singapore

1. Average Wages in Singapore

The average salary in Singapore varies significantly depending on the sector and level of experience. As a developed country, Singapore offers competitive salaries to both its local and expatriate workforce. In 2020, the average monthly salary was approximately SGD 4,563 (USD 3,370), according to Ministry of Manpower Singapore. This figure, however, encompassed a wide range of occupations and industries. When including bonuses and other forms of remuneration, the median gross monthly income for full-time employed residents was SGD 4,534 in 2020.

These figures suggest that Singapore is one of the highest paying countries in the Asia-Pacific region. However, it's crucial to understand that the cost of living is also high. Therefore, the purchasing power of the average salary in Singapore may not be as high as it appears at first glance. The average salary is typically higher for professionals working in fields such as Information Technology, Finance, and Engineering, which are all industries experiencing growth in Singapore.

Singapore does not have a set minimum wage, but it uses a system known as the Progressive Wage Model for cleaning, security, and landscape sectors. This model sets basic wage levels for workers in these sectors based on skills, productivity, and career progression. In other sectors, wages are typically negotiated between employers and employees or their trade unions. For other types of jobs, the salary can be negotiated directly between the employer and the employee.

The average monthly salary in Singapore also varies by education level. According to recent statistics, individuals with a university degree earn an average monthly salary of SGD 6,461, while those with secondary education earn around SGD 2,261.

Despite the higher than average wages when compared to many other Asian cities, there is still income inequality in Singapore. The highest earners usually work in finance and insurance, while the lowest wages are typically found in occupations such as food service, retail trade, and cleaning services.

Overall, when considering the average salary in Singapore, it's essential to keep in mind the high cost of living and the variation in wages depending on the industry, occupation, and level of education.

2. Factors that Influence Salaries

Understanding the factors that affect salaries in Singapore is crucial for both employers and employees, as it helps in making informed decisions about career choices, educational investments, and salary negotiations. In one of the world's most competitive labor markets, several key factors can have a significant impact on salary levels:

  • Educational Attainment: As with many other countries, higher education often leads to better pay. Singapore particularly values qualifications, and those with diplomas, degrees, and postgraduate credentials tend to command higher salaries.
  • Professional Experience: Work experience can increase an individual's value in the job market. Employees who have a proven track record and years of relevant experience generally have higher earning potential.
  • Industry Sector: Salaries in Singapore are greatly influenced by the industry sector. Sectors like finance, pharmaceuticals, and technology are known for offering more lucrative pay packages compared to other sectors such as hospitality or retail.
  • Job Role and Responsibilities: Beyond the industry or sector, specific roles and job responsibilities can heavily impact earning potential. Jobs that require highly specialized skills or entail greater responsibility typically provide higher remuneration.
  • Skills in Demand: The market demand for particular skills can lead to wage premiums for those who possess them. In Singapore's innovation-driven economy, skills in IT, digital marketing, analytics, and finance are often rewarded with higher pay.
  • Company Size and Revenue: Typically, larger companies with more substantial revenues have the ability to offer higher salaries compared to smaller enterprises or startups.
  • Economic Conditions: General economic conditions, including growth rates, inflation, and the unemployment rate, can influence average wages. In times of economic downturn, salary increments may be limited.
  • Supply and Demand for Labor: The balance between available jobs and the number of job seekers can also play a role. When skilled labor is scarce, employers may raise salaries to attract and retain talent.
  • Government Policies: Regulations and policies introduced by the government, such as tax structures, social security contributions, and wage-related guidelines, can impact disposable income and, consequently, salary expectations.
  • Negotiation Skills: The ability to effectively negotiate can lead to better compensation packages. This factor is often overlooked but can substantially impact the salaries that individuals are able to secure.
  • Gender: Although it is a contentious issue, gender can still be a factor affecting salaries. Gender wage gaps persist in various sectors despite efforts to bridge the inequality.

Salaries in Singapore are thus a product of a complex interplay of these and other factors, which means that even with similar qualifications, people can end up earning quite different salaries depending on their unique circumstances and the current state of the job market.

3. Minimal Wages (monthly and hourly)

Singapore does not have a universal minimum wage policy in place. Instead, the country has implemented what is known as the Progressive Wage Model (PWM), which is a tiered wage system designed to increase the wages of low-wage workers through skills upgrading and productivity improvement. The PWM is sector-specific and currently applies to the cleaning, security, and landscape sectors.

In these sectors, the basic monthly wages are set according to the employee's skill level, job scope, and responsibilities. For example, as of 2021, the PWM minimum wage for cleaners starts at SGD 1,236 per month for a general cleaner, with higher wages for those with enhanced skills and job scopes. Security officers under the PWM can earn a minimum of SGD 1,250 per month, with potential increases dependent on rank and job complexity.

The PWM also includes an annual wage progression pathway that ensures workers receive pay increments as they upskill and take on larger job scopes. This approach aims to raise the standard of living for low-wage workers over time.

Outside of these sectors, there is no mandated minimum salary; however, the government often encourages responsible wage practices among employers through recommendations and guidelines.

For part-time or casual work, wages are generally discussed and agreed upon by the employer and the employee, and they can vary greatly depending on the nature of the job and the industry.

While the government has been cautious about introducing a wide-ranging minimum wage law due to concerns about its impact on competitiveness and employment, the topic remains an ongoing point of discussion within Singapore's socio-political landscape.

4. Gender Wage Gap

In Singapore, the gender wage gap has been a subject of discussion as it exists despite efforts to achieve greater gender parity in the workforce. According to the Ministry of Manpower's report on the labor force in Singapore, the median income for women was approximately 88% of that for men in 2020. This discrepancy suggests that women, on average, earn less than men.

The gender wage gap can be attributed to various factors:

  • Occupational Segregation: Certain fields dominated by female workers, such as nursing, education, and administrative positions, tend to offer lower salaries compared to male-dominated sectors like finance or engineering.
  • Workforce Interruptions: Women are more likely to have career interruptions due to family commitments, such as maternity leave and child-rearing responsibilities, which can impact their career progression and earning capacity.
  • Part-Time Employment: A higher proportion of women engage in part-time work due to their caregiving roles, which typically pays lower hourly wages and offers fewer benefits than full-time positions.
  • Senior Leadership Representation: Women are under-represented in top management roles and board positions within companies, which are usually higher-paying.
  • Negotiation Differences: Women may approach salary negotiations differently than men, which could result in lower starting salaries and smaller increments over time.

While the gender wage gap is smaller in Singapore than in many other countries, the government along with various organizations continues to work towards policies and initiatives to encourage gender equality in the workplace. These efforts include promoting flexible work arrangements, advocating for shared parental responsibilities, and supporting women's re-entry into the workforce after career breaks.

5. Highest Paying Occupations

In Singapore, some occupations are known for offering significantly higher salaries than others. These are usually jobs that demand specific skills, advanced qualifications, and extensive experience. Here is a list of some of the highest paying occupations in Singapore:

  • Chief Executive Officers and Managing Directors: These top executives are responsible for the overall strategic direction and success of their companies, often earning high compensation for their leadership and decision-making responsibilities.
  • Specialist Medical Practitioners: Specialists such as surgeons, psychiatrists, and other medical practitioners with advanced medical training and expertise command high salaries in the healthcare sector.
  • Legal Professionals: Lawyers, particularly those who specialize in corporate law, mergers and acquisitions, and intellectual property law, are among the highest earners in the legal field.
  • Financial and Investment Advisors: With Singapore being a global financial hub, professionals in finance and investment management, including fund managers and investment bankers, typically receive substantial remuneration.
  • Information Technology Professionals: Individuals with expertise in cyber security, data science, artificial intelligence, and other cutting-edge IT specializations are in high demand and thus receive competitive pay packets.
  • Pharmaceutical and Biotechnology Scientists: Those involved in research and development within the pharmaceutical and biotech industries can earn high wages, especially if they work in senior or specialist roles.
  • Maritime and Shipbuilding Engineers: As a maritime hub, Singapore values professionals in marine engineering and ship design who play crucial roles in this specialized and lucrative industry.
  • Aerospace Engineers: Aerospace engineers skilled in the design, construction, and maintenance of aircraft and spacecraft systems are well-compensated for their complex expertise.
  • Senior Managers and Directors in Sales and Marketing: Professionals who drive revenue growth and have strategic responsibilities in sales and marketing can expect to collect high wages, especially in the competitive fields of technology and consumer goods.
  • University Professors: Academics with tenure or those who work at the top universities in Singapore may receive handsome salaries along with other academic benefits.

It's important to note that while these occupations are among the highest paid, the actual salary can vary greatly based on the individual's experience, reputation in the industry, size and profitability of their employer, and the current demand for their specific skillset.

6. Annual Average Wage Growth

Tracking the annual average wage growth in Singapore provides insight into the economic health of the country and its labor market dynamics. Wage growth is influenced by several factors, such as productivity gains, inflation rates, and supply-demand imbalances in the job market.

In recent years, wage growth in Singapore has been relatively stable, with nominal increases reflecting the country's steady economic development. Nonetheless, growth rates can fluctuate due to external economic challenges or internal policy shifts. For instance:

  • In 2019, Singapore saw an average wage growth of about 4%, according to data from the Ministry of Manpower. This growth was supported by a robust economy and tight labor market conditions.
  • However, in 2020, amidst the COVID-19 pandemic, wage growth was significantly affected. To mitigate job losses, the Singaporean government introduced measures like the Jobs Support Scheme (JSS), which helped to cushion the impact on wages. In some cases, nominal wage decreases were observed, particularly in sectors hardest hit by the pandemic.
  • As the economy started to recover in 2021, wage growth resumed as well, but with variability across different sectors. With the global situation still uncertain, the rate of wage growth was closely tied to the pace of recovery in each industry.

Real wage growth, which factors in inflation, tends to be more modest than nominal growth figures. The Singaporean government and the Monetary Authority of Singapore closely monitor inflation to ensure that real wage growth remains positive, thereby ensuring that workers' purchasing power is not eroded over time.

To forecast wage trends, analysts often look at productivity levels, which have a strong correlation with wages. A skilled and efficient workforce typically commands higher wages, which is why Singapore invests heavily in education and continuous training and development for its workforce. As companies adopt more advanced technologies and processes, productivity is expected to increase, which may contribute to higher wage growth in the future.

Lastly, it's important to note that while the average figures provide a general understanding of wage growth, individual experiences may vary greatly depending on one's occupation, industry, and personal circumstances. Market forces, such as the demand for specific roles or expertise, also play a significant role in determining one's salary trajectory over time.

7. Compensation Costs (per hours worked)

In Singapore, compensation costs extend beyond just the direct hourly wages or salaries paid to employees. They encompass various elements such as employer contributions to Central Provident Fund (CPF), bonuses, vacation allowances, and other statutory and non-statutory costs. These compensation costs per hour worked provide a holistic view of the total cost to employers for employing labor.

  • Central Provident Fund (CPF) Contributions: Employers are required to pay CPF contributions for Singaporean citizens and permanent residents, which is a key component of employment costs. The CPF is a comprehensive social security savings plan that provides for workers' retirement, healthcare, and housing needs. The employer's contribution rate varies according to the employee's age and income level, maxing out at 17% for employees under 55 years of age as of 2021.
  • Skills Development Levy (SDL): Employers must also pay the SDL for all employees up to the first SGD 4,500 of gross monthly remuneration at a levy rate of 0.25%, subject to a minimum of SGD 2 and a maximum of SGD 11.25. This levy funds workforce training programs and career development resources.
  • Work Injury Compensation Insurance: Employers need to provide work injury compensation insurance for all manual workers, as well as non-manual workers earning SGD 2,600 or less a month. This adds to the overall compensation costs and provides employees with protection against work-related injuries and diseases.
  • Bonuses and Incentives: Many Singapore companies offer annual bonuses, performance bonuses, and other incentive payments as part of their compensation packages. While not mandated by law, such bonuses are common practice and can increase the total compensation cost significantly.
  • Annual Wage Supplement (AWS): Commonly known as the ""13th-month bonus,"" the AWS is a discretionary bonus that many employers in Singapore provide, which is typically equivalent to one month's salary.
  • Vacation and Other Leave: Employers must account for paid annual leave, sick leave, and other statutory leave entitlements such as maternity or paternity leave. While these do not directly add to hourly costs, they factor into the overall compensation as non-working hours for which payment is made.
  • Professional Development: Investment in employee training and professional development programs is another component that, while not reflected in hourly wages, adds to overall compensation costs.

The exact cost of these additional components will vary by business and sector, but they are important considerations for employers when calculating the full cost of employment. Additionally, this detailed understanding of compensation costs is beneficial to employees, who get a clearer picture of the full value of their employment beyond the visible take-home pay.

8. Comparison with Other Countries

When comparing Singapore's salary levels to those of other countries, it is important to consider various factors such as cost of living, taxation, and social security contributions. Despite these complexities, international comparisons can give us an insight into Singapore's standing in the global economy. Here we compare the average wages in Singapore with a few selected countries across different continents.

CountryAverage Annual Salary (USD)Cost of Living IndexMonthly Rent Index
United States65,76071.0540.32
United Kingdom42,50067.2836.84

*Note: The figures in the table are estimations and can vary depending on sources and exchange rates. Salary data reflects the average annual gross salary, while cost of living and rent indices are relative to New York City (NYC = 100).

The United States exhibits higher average annual salaries than Singapore, but it also has lower cost of living and rent indices, indicating that the purchasing power of an average salary could be higher in the US. Australia shows a similar pattern, with average salaries close to Singapore's, but with a significantly lower cost of living.

European countries like the United Kingdom, while having lower average salaries when compared to Singapore, benefit from a more affordable cost of living index. This suggests that despite higher wages in Singapore, employees in these countries might enjoy a comparable or even better standard of living due to lower living expenses.

In contrast, Japan's salary averages are lower than Singapore's and it has similar high costs of living indices, which could imply a challenging balance for residents between earnings and expenses. Countries like India and China present dramatically lower wages alongside much lower costs of living. However, the significant wage difference also points to the vast economic disparities between Singapore and these countries.

Overall, Singapore's standing as a country with competitive wages remains strong, especially within the Asia-Pacific region. Nevertheless, when considering the high cost of living, individuals may find that their actual purchasing power can vary significantly when compared with other developed countries around the globe. It is essential for potential expatriates and local job seekers to weigh these factors carefully when considering employment opportunities in Singapore or abroad.