Singapore’s real income growth improves to 4.3% amid low inflation

[SINGAPORE] Nominal wages grew more slowly in 2025, but lower inflation meant that real wage growth accelerated to 4.3 per cent, according to preliminary figures from the Ministry of Manpower (MOM) on Friday (Nov 28).

This was up from real wage growth of 3.4 per cent in 2024, and higher than the average annual rates of 1.6 per cent in the past five years, and 2.1 per cent in the last decade.

In its annual Labour Force in Singapore Advance Release, MOM said Singapore’s labour market had “held up well” despite economic uncertainty. Unemployment stayed low, though job mobility fell – which might indicate greater worker caution, the ministry said.

In 2025, the median nominal monthly income was S$5,775. This represented a growth of 5 per cent from S$5,500 in 2024, slower than the 5.8 per cent growth last year.

But lower inflation has more than made up for weaker nominal wage growth. After slowing to 2.3 per cent in 2024, headline inflation has continued to fall, reaching a low of 0.5 per cent in August before picking up in subsequent months.

While MOM noted that real income figures involving 2025 data are preliminary – as full-year inflation figures are not yet available – the government’s forecast for headline inflation is 0.5 to 1 per cent.

Lower-wage workers saw real wage growth of 3.8 per cent, higher than the average annual rate of 2.9 per cent over both the past five years and the past decade.

At the 20th percentile, nominal monthly income grew 4.6 per cent to S$3,164, from S$3,026 before – a slower rate than last year’s 7.1 per cent. Including the Workfare Income Supplement and related payments, the nominal income growth rate was 6.1 per cent for this group.

Less job switching

Job switching continued to decrease. In 2025, 6.2 per cent of all employed residents changed jobs, down from 7.6 per cent in 2024.

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MOM noted that this was part of a post-pandemic trend, as job switching peaked in 2022 when post-Covid reopening meant a tighter labour market.

“The decline in job switching may also reflect greater caution among workers amid external uncertainties this year,” said MOM.

While job switching declined across all age groups, the fall was sharpest among workers aged 25 to 29. Of this group, 11.7 per cent changed jobs, down from 13.7 per cent in 2024.

MOM said this could be due to “the more cautious stance from employers” this year.

However, job matching quality among job switchers remained healthy. Six in 10 of those who switched jobs were paid more, “suggesting continued opportunities for upward mobility as they were generally shifting into higher-skilled positions in more productive sectors”.

Unemployment

Resident unemployment remained low and stable, for both professionals, managers, executives, and technicians (PMETs) and non-PMETs.

The unemployment rate for PMETs was 2.8 per cent, which MOM said was “broadly unchanged” from the previous year’s 2.7 per cent.

For non-PMETs, the unemployment rate improved to 2.8 per cent, from 3.4 per cent before.

Long-term unemployment also improved slightly. For PMETs, it fell to 0.6 per cent from 0.7 per cent before; for non-PMETs, it fell to 0.5 per cent, from 0.6 per cent before.

The number of discouraged workers – those not actively looking for work because they believe their job search would be unsuccessful – “remained low”, MOM said.

The figure held steady from last year at 7,400 people, or 0.3 per cent of the resident labour force.

MOM’s report also covered labour force participation, employment rates by age and gender, and forms of employment.

For instance, the resident labour force participation rate (LFPR) for those aged 15 and above eased for the fourth straight year to 67.9 per cent, down from 70.5 per cent in 2021.

MOM attributed this trend to the ageing population, noting that participation across most age groups was broadly stable or higher than a year ago.

Singapore’s overall LFPR remains among the highest across Organisation for Economic Co-operation and Development countries, it added.