What is productivity?

Over the past decade, Singapore’s economy grew by an average of 5% per annum. Singapore’s productivity growth over the same period averaged about 1% per annum, a rate on par with that of other developed countries. The broad majority of Singaporeans also enjoyed real wage growth and a rise in living standards. Nonetheless, productivity gains have declined in recent years due to heavier reliance on labour inputs to generate economic growth, especially inputs of foreign manpower. Globalisation, increased competition and lack of relevant skills have also led to slower wage growth for low-wage workers.

Only productivity-driven growth can deliver sustainable and inclusive economic development, and improve Singapore's standard of living over time. The Government will focus on productivity as a system and how employers can grow their companies without increasing their manpower at the same rate. This involves a mindset shift. Improving productivity is:

• Not about workers working longer hours; or
• Not about workers doing the same tasks faster and more cheaply;
• It is about working smarter – more efficiently, more effectively and more innovatively.