National Wages Council to Reconvene in January 2009
The National Wages Council (NWC) will reconvene in early January 2009 to review its Guidelines issued in May this year.
2. In its May Guidelines which cover the period from July 2008 to June 2009 the Council recommended that companies grant built-in wage increase commensurate with the companies' performance as well as business prospects to ensure that such increases would be sustainable. It also asked companies to consider giving a one-off special lump sum payment to rank-and-file workers to help cope with the high inflation. Other recommendations included pushing for productivity improvement; enhancing the employability of older workers; enhancing efforts to help low wage, contract and informal workers; and enhancing wage flexibility. These recommendations were made under a more favourable economic environment with a GDP growth forecast of 4.0-6.0% for 2008, while taking into consideration the global economic uncertainty and high inflation.
3. Since the release of the Guidelines, Singapore's economic growth has been dampened by the global financial crisis. MTI has moderated the GDP forecast for 2008 downwards to around 2.5% and for 2009 to be -1.0 to 2.0%, in view of the continued deterioration in the outlook for external and regional demand and increased uncertainties in the external environment. An increasing number of companies are facing issues of low demand and overcapacity and are looking at cost cutting measures to cope with the severe business downturn.
4. NWC Chairman, Professor Lim Pin said, "Given the weakening economic situation, there is a need for the NWC to take stock of the new situation and review its May Guidelines to help companies and workers manage the downturn."
5. The Council's review and its recommendations are expected to be released by mid-January 2009.