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 September 2013, the unemployment rate in Singapore was of approximately 1.8%, 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.
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Facts about the labor market in Singapore
Incomes increased significantly in 2015 because of the tight labor market in Singapore with median income, together with employer Central Provident Fund contributions, growing with 4.7% for full-time employed residents to $ 3,949 last year, from $ 3,770 in 2014.
Unemployment remained at low levels in 2015, with more Singapore residents, mainly women and aged workers, being employed. The resident labor force involvement rate increased for the fourth year consecutively, to 68.3% in the same year, from 67% 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 which include managers and executives, who are not covered by the act. 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 a fixed sum or 10% of the employee’s monthly salary 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.
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.