Singapore’s wages will grow at a faster pace in 2013, contributing to higher labor costs and price pressures even as the economy expands at a “modest” pace, the central bank said today.
The island’s job market will remain “tight” this year as demand for workers outpaces supply amid the continued tightening in foreign labor, the Monetary Authority of Singapore said in a twice-yearly review. A Manpower Ministry report today showed job creation in the three months through March 31 was the weakest in 10 quarters, and the unemployment rate rose from a five-year low.
Singapore tightened curbs on overseas workers for a fourth straight year in February and unveiled measures that will raise wage costs for companies through 2015, as the government steps up efforts to increase productivity. The central bank, which uses its exchange rate to manage inflation, stuck to a policy of allowing gradual gains in its currency even after the economy unexpectedly contracted last quarter.
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