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Tight labour market, negative inflation raise median income (Amended)
REAL median income in Singapore jumped strongly by 5.4 per cent this year, thanks to the still-tight labour market and negative inflation.
But the softer economy is starting to weigh down on jobs; employment growth eased in the first half of the year, the Ministry of Manpower (MOM) cautioned at the release of its Singapore Workforce 2015 report on Monday.
This slower pace of increase in jobs - slower than in the past five years - is expected to continue for the rest of the decade as growth in the resident labour force eases and economic restructuring continues, the ministry said in a statement.
The report said that this year, the nominal median income from work for full-time resident workers - that is, Singaporeans and Permanent Residents - went up by 4.7 per cent from a year ago to S$3,949 in June.
The consumer price index for all items is tipped to dip by around 0.5 per cent for the year. "After adjusting for negative inflation, real median income grew at a faster pace of 5.4 per cent (preliminary)," the report said.
Resident workers have enjoyed sustained median income growth in the past five years, improving their monthly income from S$3,000 in 2010. This works out to a 32 per cent hike, or 5.7 per cent annum in nominal terms.
In real terms, their income jumped 16 per cent or 3.1 per cent yearly.
Lower-income earners, whose incomes have been given a boost in recent years, recorded a continued rise in their incomes over the same period, said the report.
"Income (including employer CPF contributions) at the 20th percentile of full-time employed residents rose by 26 per cent from S$1,600 in 2010 to S$2,012 in nominal terms in 2015, or 4.7 per cent per annum," it said.
The real increase was 11 per cent, or 2.1 per cent annum.
Job growth has been faster for professionals, managers, executives and technicians (known as PMETs) than for individuals outside this group. The proportion of PMETs among employed residents rose from 49 per cent in 2007 to 54 per cent this year.
Part-time employment has stabilised, after an uptrend in earlier years, the report said. Some 10.4 per cent of employed residents were part-timers in 2015, no big difference from 2014, when it was 10.5 per cent.
Contract employment shrank, after an uptick in 2014. Some 11.3 per cent of resident employees were on term contracts this year, down from 11.8 per cent in 2014.
"This resumed a general downward trend in incidence of term contract employment from the peak in 2009," the report said.
The employment rate of residents aged 25 to 64 rose from 79.7 per cent in June 2014 to 80.5 per cent in June this year, helped by strong job gains in the second half of last year.
"This continued a broadly consistent uptrend from 75.5 per cent in 2006," the report said.
The increase in employment rate for older men aged 55 to 64 has moderated in the past three years, after the spike from 71.3 per cent in 2006 to 79.7 per cent in 2012.
The resident unemployment rate stayed low, at 2.8 per cent in June, similar to a year ago. Unemployment climbed for older residents - those aged 50 and over - and non-degree holders as job growth eased in the first half of this year.
More women continued to join the labour force, raising their labour force participation rate from 54.3 per cent in 2006 to 60.4 per cent in 2015, but the participation rate for men has been relatively stable.
There were 2.23 million residents in the labour force in June this year, with 1.22 million men and 1.02 million women. Reflecting an ageing population, about one in three residents in the labour force were workers aged 50 and over, up from one in four in 2006.
But the quality of the resident labour force has improved, with 52 per cent of the residents in the labour force being tertiary-educated, up from 39 per cent in 2006.
Amendment: This piece has been amended to clarify the age bands on the participation rate for older residents.