As Singapore moves through 2025, the city-state’s salary landscape is shifting under the combined pressures of global economic uncertainties, domestic inflation, and evolving workforce expectations. While pay rises are on the horizon, they are tempered by a soaring cost of living, leaving many Singaporeans to question whether their incomes can keep pace with everyday expenses.

Moderate Salary Growth Forecast

According to data released by human resources consultancy Mercer, salaries in Singapore are projected to rise by an average of 4.1% this year, with variations depending on industry and role seniority. This is a modest improvement compared to previous years, signaling cautious optimism among employer.

Further estimates from other HR firms suggest salary increments will generally range from 2% to 5%, reflecting a stabilizing but conservative hiring climate across most sectors.

Industry Leaders in Wage Growth

Not all sectors are experiencing growth equally. Industries such as real estate, consumer goods, retail, and financial services are expected to lead salary hikes in 2025. These industries have either bounced back strongly post-pandemic or are undergoing digital transformation that requires skilled talent both of which drive competitive compensation packages.

The banking and finance sector, in particular, continues to offer some of the most attractive salary increments, buoyed by Singapore’s role as a key regional financial hub. In contrast, manufacturing and logistics are expected to grow at a slower pace due to tighter margins and global supply chain uncertainties.

Average and Median Salary Trends

According to recent figures from Singapore’s Ministry of Manpower (MOM), the median gross monthly income for full-time employed residents rose to S$5,800 in 2025 a 5.5% increase from 2024. This figure includes employer Central Provident Fund (CPF) contributions and is seen as a reflection of growing wage competitiveness.

Meanwhile, the average monthly salary, which tends to be skewed by higher-income earners, stands at approximately S$7,310. These figures align with broader labor market trends reported in the Labour Market Report by MOM.

Hiring Outlook for 2025

Although salary increases are forecasted, hiring remains steady rather than expansive. A survey from Mercer notes that only 17.5% of companies plan to increase their workforce in 2025. The majority remain cautious due to global headwinds and the risk of recession in major economies like the U.S. and China.

The MOM’s employment outlook data also shows that while the unemployment rate remains low around 2.0% employers are focusing more on productivity improvements and digital transformation than on headcount expansion.

Cost of Living Still a Concern

Even as wages rise, many Singaporeans are grappling with the country’s high cost of living. In 2024, Singapore was once again ranked the most expensive city in the world alongside Zurich, according to the Economist Intelligence Unit.

Rising prices in key areas such as housing, childcare, medical expenses, and transportation have become pain points for families. The upcoming Presidential Election in May 2025 has already seen cost-of-living concerns dominate public discourse (source).

Singaporeans are advised to refer to government resources such as the Ministry of Trade and Industry (MTI) for updates on inflation policies and the Housing & Development Board (HDB) for housing grant schemes and subsidies.

Upskilling and Digital Transformation

In response to rapid technological changes, workers are encouraged to pursue upskilling programs, particularly in AI, data analytics, cybersecurity, and green economy sectors. These fields continue to attract higher wage premiums.

Government support for continuous learning is available through platforms like SkillsFuture Singapore, which provides subsidized courses and credits for mid-career transitions.

What This Means for Employees

While the 4.1% salary growth in 2025 may bring relief to some, it is clear that wage increases alone may not offset inflationary pressures. Employees are increasingly evaluating compensation packages based on total rewards, including flexible work arrangements, mental health benefits, and career development opportunities.

“Salary is no longer the only driver,” said a local HR consultant. “Candidates are looking at the full experience work-life balance, purpose, and growth.”

Conclusion

Singapore’s salary outlook in 2025 is one of steady, modest growth amid broader economic uncertainty. While key sectors show strong promise, and average salaries are rising, challenges remain particularly with the high cost of living continuing to affect the real value of wages.

To navigate this evolving landscape, both employers and employees must focus on adaptability, upskilling, and long-term planning. For those entering or changing roles in 2025, understanding salary benchmarks and the macroeconomic context will be crucial.