By Olivia Ho, The Straits Times, 2 Dec 2015
Employers will continue to receive a subsidy for hiring older workers for at least another year, the Ministry of Manpower (MOM) announced yesterday.
A wage subsidy to reward those who voluntarily re-employ older locals will be extended beyond its original deadline of the end of this year, Manpower Minister Lim Swee Say said during a site visit to packaging firm TCG Rengo.
Under the scheme, employers can get up to 3 per cent more wage credit if they rehire Singaporeans who are aged 65 and above, and who earn up to $4,000 a month.
Mr Lim said the Government has paid out over $22 million to more than 49,000 employers for rehiring about 110,000 of these older workers in the first half of this year.
The wage offset was introduced during the Budget in February to help employers manage costs, in the face of legislation to raise the re-employment age ceiling to 67 by 2017.
The subsidy will now be extended until whenever the new law kicks in. Under current legislation, employers must offer re-employment to eligible workers when they turn 62, up to the age of 65.
The fresh extension comes in the wake of the MOM's latest labour report, which was released on Monday and showed that a continued tight labour market had pushed up salaries.
National Trades Union Congress (NTUC) deputy secretary-general Heng Chee How said the labour movement welcomed the move, adding that it could help employers cope with the higher training and healthcare costs that hiring older workers might incur.
However, he warned against using the additional credit in the "most passive way", treating it as a mere subsidy that lowers payroll costs, instead of pumping it into training or restructuring.
Employers will continue to receive a subsidy for hiring older workers for at least another year, the Ministry of Manpower (MOM) announced yesterday.
A wage subsidy to reward those who voluntarily re-employ older locals will be extended beyond its original deadline of the end of this year, Manpower Minister Lim Swee Say said during a site visit to packaging firm TCG Rengo.
Our local labour force growth has slowed down and will continue to slow down further. Job growth will also moderate in...
Posted by Singapore Ministry of Manpower on Tuesday, December 1, 2015
Under the scheme, employers can get up to 3 per cent more wage credit if they rehire Singaporeans who are aged 65 and above, and who earn up to $4,000 a month.
Mr Lim said the Government has paid out over $22 million to more than 49,000 employers for rehiring about 110,000 of these older workers in the first half of this year.
The wage offset was introduced during the Budget in February to help employers manage costs, in the face of legislation to raise the re-employment age ceiling to 67 by 2017.
The subsidy will now be extended until whenever the new law kicks in. Under current legislation, employers must offer re-employment to eligible workers when they turn 62, up to the age of 65.
The fresh extension comes in the wake of the MOM's latest labour report, which was released on Monday and showed that a continued tight labour market had pushed up salaries.
National Trades Union Congress (NTUC) deputy secretary-general Heng Chee How said the labour movement welcomed the move, adding that it could help employers cope with the higher training and healthcare costs that hiring older workers might incur.
However, he warned against using the additional credit in the "most passive way", treating it as a mere subsidy that lowers payroll costs, instead of pumping it into training or restructuring.
"We must think about what we must do to our HR processes, our operations methods, and our technology and equipment... so that when the law kicks in in 2017, companies are ready, and workers are ready."
Packaging company TCG Rengo re-employs 16 older workers, five to six of whom are eligible for the 3 per cent subsidy. Managing director Phua Thye Hin, 56, said: "It's useful to defray some of our costs. The extension is a welcome message from the minister."
In order to reduce the manual demands upon its older workers, the company has been investing in equipment such as automatic stacking machines and devices to push paper rolls weighing a tonne or more.
Monday Blues? We feel you.Here are four quick takeaways for you from the Singapore Workforce 2015...
Posted by Singapore Ministry of Manpower on Monday, November 30, 2015
Tight Singapore labour market pushes up wages
Median pay for full-time residents up 4.7%; such growth unlikely next year, experts warn
By Joanna Seow, The Straits Times, 1 Dec 2015
Incomes in Singapore grew strongly this year due to the tight labour market, but economists caution that this is unlikely to continue next year, given the sombre economic outlook.
Median income, including employer Central Provident Fund contributions, rose 4.7 per cent for full-time employed residents to $3,949 in 2015, from $3,770 last year.
Continued labour market tightness and manpower shortages in some industries pushed up pay, said the Manpower Ministry in its latest Singapore Workforce report released yesterday.
After accounting for negative inflation - the consumer price index is projected to fall by around 0.5 per cent this year - the average Singaporean or permanent resident worker earned 5.4 per cent more than last year. Last year had seen muted median salary growth of just 0.7 per cent in real terms.
Experts said the pickup in wage growth was likely driven by competition for workers. "Some workers have been able to get quite good increases despite gloomy economic growth," said SIM University economist Randolph Tan.
Mr Victor Tay, business representative of the Reach supervisory committee and Singapore Business Federation chief operating officer, said: "The National Wages Council has been recommending increases in wages, and it's a tight labour market so everyone is competing to raise salaries to retain staff."
But Associate Professor Tan cautioned that wage growth which outpaces real output growth would not be sustainable. "If it grows too fast, it suggests that at some point in the near future it might come to a screeching halt."
Median pay for full-time residents up 4.7%; such growth unlikely next year, experts warn
By Joanna Seow, The Straits Times, 1 Dec 2015
Median income, including employer Central Provident Fund contributions, rose 4.7 per cent for full-time employed residents to $3,949 in 2015, from $3,770 last year.
Continued labour market tightness and manpower shortages in some industries pushed up pay, said the Manpower Ministry in its latest Singapore Workforce report released yesterday.
After accounting for negative inflation - the consumer price index is projected to fall by around 0.5 per cent this year - the average Singaporean or permanent resident worker earned 5.4 per cent more than last year. Last year had seen muted median salary growth of just 0.7 per cent in real terms.
Experts said the pickup in wage growth was likely driven by competition for workers. "Some workers have been able to get quite good increases despite gloomy economic growth," said SIM University economist Randolph Tan.
Mr Victor Tay, business representative of the Reach supervisory committee and Singapore Business Federation chief operating officer, said: "The National Wages Council has been recommending increases in wages, and it's a tight labour market so everyone is competing to raise salaries to retain staff."
But Associate Professor Tan cautioned that wage growth which outpaces real output growth would not be sustainable. "If it grows too fast, it suggests that at some point in the near future it might come to a screeching halt."
Despite ongoing initiatives to boost their incomes, workers in the bottom 20 per cent income bracket saw their pay go up at a slower pace than that of the average worker over the past five years.
Incomes at the 20th percentile rose by an average of 2.1 per cent a year from 2010 to 2015, while those at the median rose 3.1 per cent a year, after accounting for inflation.
National Trades Union Congress assistant secretary-general Zainal Sapari said more needs to be done for low-wage workers, such as making the 13th-month annual wage supplement mandatory.
Unemployment remained low over the year, and more Singapore residents, especially women and older workers, entered the labour force. The resident labour force participation rate rose for the fourth year in a row to 68.3 per cent for 2015, from 67 per cent last year.
But with rising wage costs, businesses are feeling the pinch. "We're seeing quite a lot of companies freezing headcount or slowing down recruitment, especially with the foreign worker quotas restricted as well," said Mr Tay.
This could keep a lid on wage growth, said Credit Suisse economist Michael Wan. "The story for 2016 is tepid demand for labour because of restructuring, weak macro- economic conditions and China's slowing growth," he said.
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