SINGAPORE, Jan 16 - Singapore's National Wages Council said on Friday unemployment will be "substantially higher" this year, and recommended firms affected by the economic downturn institute a wage freeze or wage cuts to stay competitive and save jobs.
The council, which comprises representatives from government, employers and unions, however, ruled out cutting employers' contribution to the Central Provident Fund, the retirement fund for Singapore workers.
"It's not an ideal instrument, we don't want to use it," NWC Chairman Lim Pin said at a media conference.
He said cutting pensions hurt workers at firms that were doing well and also created longer-term problems since Singaporeans used the funds to cover medical costs and for their retirement.
The government had cut CPF contributions in a bid to lower labour costs during previous recessions.
Singapore was the first Asian economy to fall into a recession in 2008 and the government has warned that the economy may shrink as much as 2 percent this year.
Recommendations by the NWC are not binding on employers but are usually followed by state-linked firms such as Singapore Telecommunications <STEL.SI> and DBS Group <DBSM.SI>.
The council usually meets in May but was convened four months ahead of time to set wage guidelines amid a worsening economic outlook.
>> ASIAONE / NEWS / ASIAONE NEWS / SINGAPORE / STORY
Government accepts National Wages Council's revised guidelines
Fri, Jan 16, 2009
AsiaOne
>The Government strongly supports NWC's call for companies and workers to work together to reduce and manage costs to save jobs, which may include a wage freeze or wage cut. Companies should implement this recommendation based on their individual circumstances and taking into consideration the impact of the downturn on the company.
More details to come
The council, which comprises representatives from government, employers and unions, however, ruled out cutting employers' contribution to the Central Provident Fund, the retirement fund for Singapore workers.
"It's not an ideal instrument, we don't want to use it," NWC Chairman Lim Pin said at a media conference.
He said cutting pensions hurt workers at firms that were doing well and also created longer-term problems since Singaporeans used the funds to cover medical costs and for their retirement.
The government had cut CPF contributions in a bid to lower labour costs during previous recessions.
Singapore was the first Asian economy to fall into a recession in 2008 and the government has warned that the economy may shrink as much as 2 percent this year.
Recommendations by the NWC are not binding on employers but are usually followed by state-linked firms such as Singapore Telecommunications <STEL.SI> and DBS Group <DBSM.SI>.
The council usually meets in May but was convened four months ahead of time to set wage guidelines amid a worsening economic outlook.
>> ASIAONE / NEWS / ASIAONE NEWS / SINGAPORE / STORY
Government accepts National Wages Council's revised guidelines
Fri, Jan 16, 2009
AsiaOne
>The Government strongly supports NWC's call for companies and workers to work together to reduce and manage costs to save jobs, which may include a wage freeze or wage cut. Companies should implement this recommendation based on their individual circumstances and taking into consideration the impact of the downturn on the company.
More details to come
