Companies in Singapore are gradually restoring workers' pay to pre-pandemic levels, according to new research from DBS. The bank's latest “NAV Financial Health Series” report—part of a research series launched last year to track how Singapore residents are managing their personal finances amid COVID-19's economic impact—shows that the proportion of DBS customers earning at least 10 percent less than their pre-pandemic wages was at 19.4 percent in December 2020, down from 26 percent in May.
Within this group, the income reduction was also slightly less severe, with fewer people earning at least 30 percent less than their pre-pandemic average. The research series had earlier attributed the fall in income to reasons such as pay-cuts, shorter working hours, and lower variable compensation, suggesting that most of these have now been at least partially reversed.
However, the report also shows that low-wage workers, defined as those earning less than S$3,000 per month, still account for almost 50 percent of those who have seen their income decline. More than half of these workers also have less than a month of emergency savings.
In contrast, the higher someone's salary was, the less likely they were to have experienced an income reduction last year, with the exception of the most highly paid (S$10,000 a month or more).
Furthermore, middle-aged workers—those between 35 and 44 years of age—were worst affected, with almost half of them seeing their income decline by at least 30 percent. This group also experienced the largest increase in unemployment last year, according to figures from the Ministry of Manpower.
In its report, DBS highlighted the need for “more sustained and targeted support”, especially for lower-income workers, and for those in the aviation and hospitality sectors which are facing a poor near-term outlook.