Singapore nominal wage growth to hover at 4-5% in 2013: OCBC

Will lkely outpace headline inflation.

"We anticipate nominal wage growth to remain around 4-5% in 2013, but headline inflation to subside slightly to around 3% handle, suggesting that real wage growth could revert to positive growth again," said OCBC in its Weekly Macro views report.

The forecast came after the government data revealed that after adjusting for headline inflation, real total wages fell by 0.4% in 2012, after rising by 0.9% in 2011. If adjusted using CPI less imputed rentals on OOA, then real total wages rose 0.5% last year after increasing by 1.9% in 2011, OCBC noted.

Total private sector wages (including employer CPF contributions) rose 4.2% in 2012, slower than the +6.1% seen in 2011, as the domestic economy moderated.

The drivers were a 4.5% hike in basic wages, whereas bonuses (annual variable component) fell from 2.32 months in 2011 to 2.19 months in 2012.