SINGAPORE: Singapore’s newest graduates are entering the workforce with high hopes and, in many cases, lower-than-expected pay packets.

A recent Ministry of Manpower (MOM) survey, cited by Channel NewsAsia (CNA), found that graduates across most fields are earning less than they anticipated when they first started job searching. The mismatch is prompting analysts to urge young job seekers to be more realistic about salary expectations as hiring conditions become tougher.

The findings also reveal a growing tension between what graduates believe they are worth and what employers are willing to pay in an uncertain economy.

Salary expectations meet market reality

The survey, which covered residents aged 22 to 28, showed noticeable differences between expected and actual starting salaries across several disciplines.

Information technology graduates expected an average monthly pay of S$6,000 but earned about S$5,150. Engineering sciences graduates anticipated S$5,000 but received around S$4,450.

Business administration graduates faced one of the largest mismatches. While many expected S$5,000, average earnings came in closer to S$4,000. Natural and mathematical sciences graduates also saw a sizeable difference, with expected salaries of S$5,000 and actual earnings averaging S$3,700.

Not every discipline experienced disappointment, though. Law graduates exceeded expectations, earning about S$7,500, compared with an expected salary of S$6,500. Education graduates also slightly outperformed expectations, while fine and applied arts graduates generally earned what they expected.

The figures suggest that graduate salary expectations are becoming increasingly disconnected from hiring realities in some sectors.

Low salaries are one of the reasons fresh grads reject job offers

The survey also examined why some graduates walk away from job offers. Low pay emerged as the leading reason. Among university graduates who rejected offers, 30.6 per cent said the salary was not attractive enough.

Others believed better opportunities might be available elsewhere, while some felt the roles didn’t match their interests. Workplace culture and career progression were also factors behind the rejection of offers.

Professor Lawrence Loh, Director of the Centre for Governance and Sustainability at the National University of Singapore (NUS) Business School, said that salary concerns are linked to rising living costs and long-term career planning.

His view was that many graduates see their first salary as an important benchmark because future increments can be harder to secure. A stronger starting point can influence earnings and career opportunities for years to come.

Knowing your value and understanding the market

Analysts say graduates who insist on holding out for ideal salaries may face longer job searches. Anurag Garg, Country Lead at recruitment firm Michael Page Singapore, said that extended job-seeking can leave candidates frustrated and cause them to miss suitable opportunities.

At the same time, employers are facing their own challenges. Companies competing for skilled talent are seeing more offers rejected, which can slow hiring and increase recruitment costs.

The deeper problem may be one of expectations. Graduates want salaries that match their qualifications and rising costs of living. Employers, meanwhile, are navigating inflation, economic uncertainty and tighter budgets.

For Singapore’s newest job seekers, the lesson may be to know your value, but understand the market. The first job doesn’t have to be the perfect job, as building experience, skills and a track record creates more earning power than waiting indefinitely for an ideal offer.

This article (SG job analyst: Singapore fresh grads need to ‘taper down’ their salary expectations or risk delaying their entry into the workforce) first appeared on The Independent Singapore News.

SINGAPORE: Singapore workers received pay rises for a second straight year in 2025, although wage growth slowed compared with 2024.

The good news is that workers were still better off in real terms. With inflation easing, salaries stretched further, giving employees a stronger boost in purchasing power than the year before.

According to the Ministry of Manpower (MOM) on May 28, nominal wages for full-time resident employees who stayed with the same employer for at least a year rose by 4.9 per cent in 2025, down fro`m 5.6 per cent in 2024. After adjusting for inflation, real wages increased by 4.0 per cent, up from 3.2 per cent the previous year.

Nick Karean/The Independent Singapore News

MOM: Wage Growth 2025

The figures suggest that while pay packets didn’t grow as fast based on data, workers still benefited from a lower cost-of-living environment than in 2024.

More companies remained profitable

MOM’s report showed that business conditions stayed fairly healthy through 2025. More than eight in 10 establishments, or 83.1 per cent, reported making a profit, up from 80.8 per cent in 2024. At the same time, the share of companies reporting losses fell to 16.9 per cent from 19.2 per cent a year earlier.

The data paints a picture of a business sector that stayed resilient despite ongoing global economic uncertainty. Smaller firms were still more likely to report losses than larger companies, mirroring the tougher operating conditions faced by businesses with fewer resources.

Employers became more careful with salary increases for employees

While most employers continued raising salaries for workers, there were signs of greater caution. About 72.4 per cent of establishments increased wages in 2025, down from 78.3 per cent in 2024. Meanwhile, nearly a quarter of firms left wages unchanged, up from 18.5 per cent the year before.

Among companies that granted pay increases, the average wage rise was 5.8 per cent. Employee retention remained the main reason employers chose to increase salaries. In a tight labour market, retaining experienced staff remains a priority for many businesses.

Only 3.1 per cent of companies reduced wages; those that did generally faced weaker business performance than in the previous year. The trend shows that workers still expect wage growth, but businesses are also preparing for economic uncertainty and rising costs.

Wage gains spread across sectors and job levels

One notable finding from the report was that wage growth was broad-based. Rank-and-file employees saw wages grow by 4.8 per cent, junior managers by 5.1 per cent and senior managers by 4.9 per cent. The differences between these groups narrowed, suggesting gains were shared more evenly across the workforce.

Every sector recorded positive wage growth. Administrative and Support Services posted the strongest increase at 7.5 per cent. The sector includes cleaning, security and landscape services, where lower-wage workers continue to benefit from the Progressive Wage Model and Local Qualifying Salary requirements.

Financial Services and Insurance Services also recorded healthy wage growth as demand remained strong for professionals and managers.

Nick Karean/The Independent Singapore News

MOM: Wage Growth by Industry 2025

The accommodation and construction sectors still saw pay increases, but at a slower pace than the previous year, as hiring demand stabilised following the post-pandemic rebound.

Workers can expect real wage growth to stay positive in 2026

MOM expects real wage growth to remain positive in 2026. However, businesses are likely to stay cautious when deciding on salary increases due to inflation risks and geopolitical tensions.

As such, workers may continue seeing pay rises, but probably not at the pace many experienced during the stronger post-pandemic recovery years.

The report indicates that wage growth is still tied to productivity. Sustainable salary increases depend on businesses becoming more productive, workers upgrading their skills and companies maintaining healthy financial performance.

What matters more now than how much salaries increase is how much purchasing power is left for Singaporeans after their everyday expenses are paid.

Read related: Singapore job hiring drops across most sectors despite AI-driven manufacturing demand; employment outlook weakens in the coming months

This article (MOM: Wage growth slowed down for workers in Singapore last year compared with 2024; expected to stay moderate in 2026) first appeared on The Independent Singapore News.