Labor Market in Singapore

Singapore is one of the most developed economies in Asia, hence there is a labor market which is open to expatriates, with thousands of positions available in different industries. In 2025, the overall unemployment rate in Singapore averaged about 2.0%, obviously smaller than that of North American or European average. The country has a profitable taxation system and a booming economy, hence the reason it is estimated to attract plenty of new immigrants yearly, with one third of the population being of foreign origin.

The labor authority in Singapore, dealing with employing foreign workforce, work permits, leave, public holidays, employment rights and conditions and other labor related issues in the country, is the Ministry of Manpower. Local companies that want to ensure they comply with the employment legislation are advised to seek assistance from an accountant in Singapore.

Facts about the labor market in Singapore

Incomes increased significantly in 2025 because of the tight labor market in Singapore with median income, together with employer Central Provident Fund contributions, growing by 5.0% for full-time employed residents to $ 5,775 in 2025, from $ 5,500 in 2024.

Unemployment also remained low in 2025 (resident unemployment rate: 2.8%), with more Singapore residents, mainly women and aged workers, being employed. The resident labor force involvement rate edged down for the fourth consecutive year, to 67.9% in 2025, from 68.2% in the previous year. 

Employment in Singapore

The main rules of employer-employee relationships in the city-state are governed by the Employment Act. All workers, local or foreign, who sign a contract of service with employers are covered by this law. There are, though, certain exceptions such as seafarers, domestic workers and civil servants; since 1 April 2019 managers and executives are also covered. The act regulates the rest days, hours of work, yearly leave and other conditions of employment. For managers and executives, these regulations can differ according to the particular contract of employment.

The social security system in Singapore is administered by the Central Provident Fund (CPF), offering social security for local employees. Each employee has to pay a certain amount of their income to the CPF. Employers are also required to pay up to 17% of the employee’s monthly wages (for employees aged 55 and below) to the fund. The amounts vary depending on the employee’s earnings and age. Foreigners who are temporary residents in the country are not covered by the above mentioned fund. 

Our accounting firm in Singapore can offer thorough tax planning and payroll services. You must have access to information about your employees, including their name, address, NRIC/FIN number, and salary, before you can process payroll. However, keeping so much information can be difficult. This is why many companies use the services provided by our payroll company in Singapore to streamline the entire process. Feel free to inquire about our solutions.

For more details on the labor market and legislation in Singapore, as well as the taxes on salaries in this country, please get in touch with our accountants in Singapore.