Bigger pay hikes in 2022 as employers price in higher cost of living: HR firms

EMPLOYERS are expected to provide larger-than-usual salary adjustments in 2022 to stay ahead of soaring inflation, say human resource and employment consultants, with companies such as Singtel already doing so.

Nominal pay rises must outpace inflation for wages to grow in real terms. Headline inflation is expected to be 4.5 to 5.5 per cent in 2022, up from 2.3 per cent in 2021; core inflation is expected to be between 2.5 per cent and 3.5 per cent in 2022, up from 0.9 per cent in 2021.

Despite fears that inflation will erode wages, Singapore is still likely to maintain real wage growth in 2022, according to the latest wage practices report by the Ministry of Manpower on Monday (May 30).