Gross monthly salaries of 46,000 retail workers set to go up 18% over 3 years, after recommendations by tripartite group

SINGAPORE — By September 2024, retail assistants and cashiers are set to earn a minimum monthly gross salary of S$2,175, after recommendations by a tripartite retail cluster were accepted by the Government. The Singapore Retailers Association (SRA) said the move is urgently needed to tackle the sector's acute manpower shortage.

In all, some 46,000 full-time and part-time resident workers would benefit from pay rises of 18 per cent spread over three years starting Sept 1 this year for jobs in the lower rungs of the retail sector.

The recommendations for the salary boost, and to provide a career pathway, were made by a tripartite cluster that is working to implement the progressive wage model (PWM) for the retail sector.

The tripartite cluster said in a press release on Monday that it recommends a compound annual growth rate of between 8.4 per cent and 8.5 per cent for each of the next three years for the baseline gross wages of the sector’s three lowest job rungs.

In a press release later on Monday, the Ministry of Manpower (MOM) said the Government has accepted the tripartite cluster's recommendations.

These pay increases will bring retail workers a step closer to earning what the second decile of the local workforce does.

Last February, Senior Minister of State for Manpower Zaqy Mohamad said about 45 per cent of full-time resident employees in retail earned at or less than the 20th wage percentile of the local workforce, which was nominally S$2,340 including employers' Central Provident Fund contributions as of June 2020.

The PWM, which started in 2012, is a framework where wages are pegged to skills, productivity and career development and it has since been rolled out to the cleaning, security, landscape, lift and escalator, and waste management sectorz. These sectors will all see an annual wage increment of at least 6.4 per cent.

The inclusion of the retail sector means that it is the biggest to be covered by the framework to date. 

According to the tripartite's recommendations, the baseline salary for retail assistants or cashiers, excluding overtime pay, will be required to be bumped up to at least S$1,850 a month, or S$9.70 per hour from Sept 1.

The salary review website Glassdoor indicated that the average salary for workers in this category is S$8 per hour.

The monthly wages for retail assistants or cashiers are then expected to increase to S$1,975 from Sept 1 next year and to S$2,175 from Sept 1 in 2024.

As for senior cashiers or senior retail assistants, the tripartite recommended that their average monthly wage, excluding overtime pay, should be at least S$2,035 from Sept 1, S$2,175 from Sept 1, 2023 and S$2,395 from Sept 1, 2024.

Similar recommendations were given for assistant retail supervisors, which include bringing their salary up to at least S$2,240, S$2,395 and S$2,634 over the same period.

The tripartite cluster said the salary increases will be co-funded by the Government under the Progressive Wage Credit Scheme, announced during this year's Budget to provide transitional support for businesses moving to the Progressive Wage Model.

In its press release, MOM said employers will also be given six months — from September this year to February next year — to adjust and comply with the PWM requirements.

The ministry added that instead of enforcement, it will focus on educating employers on the various progressive wage requirements.

Said MOM: "Employers who do not comply with the requirements during this transitional period will not have their work pass privileges suspended."

MOM also said that it had accepted the tripartite cluster's recommendation that the average wage of a retail worker over a three-month period be used in assessing if employers are fulfilling the retail PWM wage requirements.

It said that this arrangement recognises that employers’ revenue and retail workers’ variable wage components such as commissions "may fluctuate according to seasonality".

The tripartite cluster said this will enable retail workers to “take on higher value job roles with higher productivity for sustainable wage increases”.

It also charted career progression for workers in the retail industry.

For instance, someone beginning in an entry-level position such as a retail assistant or a cashier can expect to be promoted to a senior retail assistant or senior cashier.

As they progress through the career ladder, they will see themselves moving up to become an assistant retail supervisor, retail supervisor and retail manager.

MOM said the career ladder will provide workers with a clear progression pathway to higher wages, better skills and increased job responsibilities, which will "enhance the retail sector’s attractiveness to resident workers".

The Singapore Retailers Association said in a statement on Monday that it endorses the tripartite recommendations as a "step in the right direction to help rebuild retail as an attractive career choice”.

The association stressed that the acute manpower shortage is a critical issue facing most if not all retail businesses.

“If left unaddressed in the immediate term, Singapore will be hard pressed to retain its reputation as a vibrant shopping and lifestyle destination with superior service delivery,” it added.