Slower wage growth to help ease costs

Singapore

BUSINESS costs for the manufacturing and services sectors are expected to fall this year on the back of moderating wage growth, easing rental costs and lower utilities and fuel-related costs, said the Ministry of Trade and Industry in a study.

This, however, is contingent on productivity growth, which would reduce unit labour costs - a big cost factor for both manufacturers and services firms - that have been consistently increasing in recent years.

In the past five years, the unit business costs - relative costs of producing one unit of real output - have risen by 2.5 per cent on average each year for the manufacturing sector, and for the s…