ECONOMY, HR & EDUCATION | Staff Reporter, Singapore

Chart of the Day: Will wage growth in Singapore stall in 2017?

Analysts foresee growth to moderate around 2% next year.

As the number of jobless people is rises in Singapore, wage growth is foreseen to likely stall next year, analysts said.

According to Maybank KimEng, monthly wages posted decent growth in 3Q16 at 3.4%, with 9M16 averaging 3.9%.

"But, in our view, wage growth will likely moderate to sub-2% in 2017 with job creation moderating and, anecdotally, a number of businesses under our stock coverage universe are cautious about near-term outlook and undertaking cost rationalization measures," the brokerage firm noted.

The prediction came as unemployment rate remained manageable at 2.1% in Sep 2016, amongst the lowest in Asia, aided by the progressive tightening of foreign worker policies.

"There has been a slight uptick in recent months, likely from the downturn in the offshore & marine, energy sectors, and now lies towards the higher end of the 1.8-2.3% range witnessed since tightening measures were introduced in 2010. In the near term, further small increases in unemployment in the c0.1-0.3% levels are likely with ongoing restructuring in offshore & marine plus more downsizing in financial services," Maybank explained. 

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