How much are expats earning?
Twenty-eight year old Kieran Hughes had high hopes when he decided to move to Singapore to be with his partner a year ago. Back in the United Kingdom, Hughes worked as a professional broadcast engineer earning $96,000 a year, enough to pay for mortgage and buy his own car. With his strong career background, he thought finding a job in Singapore with the same competitive pay would be just as easy. But when he started working in an audio-visual firm as a project manager, he suddenly realised that he bought himself a one-way ticket to dismal pay conditions.
Hughes earns $4,000 a month – just enough to pay for his rent in a tiny dwelling and to cover for necessities. He describes living in Singapore as “barely living” and was nowhere near the life that he had back in the UK. “I have a three-bedroom house in the UK with big garden front and back and I rent it out for approx. $1,000 dollars a month. Here in Singapore you can barely get a bedroom in a shared apartment for that kind of price,” he recalled.
Hughes is one of the 1.3m foreigners trying to make a living in Singapore. And whilst Singapore continues to be the most generous when it comes to expat salaries and benefit packages, it is almost like survival of the fittest for most of the expats like Hughes.
Shrinking pay packages
In a recent study by ECA International, expat packages in Singapore have fallen 6% to $316,600 per annum, inclusive of salary, tax, and benefits. Meanwhile, in its closest rival Hong Kong, expat packages declined 2% to $356,800 per annum. Over the past five years, the gap has widened between Singapore and Hong Kong for the total cost of an expatriate package offered to Middle Managers.
“Expatriates in Singapore have some or all of their cash and benefits determined in SGD values. For the purpose of our cross border comparison we have converted values into USD. As the value of the SGD has fallen against the USD in the past 12 months, USD values of expatriate packages in Singapore have suffered,” explains Lee Quane, ECA International’s regional director.
He adds that the costs associated with some of the benefits that have been provided to Singapore-based expatriates have fallen in the past 12 months. This led to accommodation costs in areas commonly inhabited by expatriate staff to fall in the past year, reducing the costs associated with housing assistance provided to expatriates.
Quane argues that this would not affect Singapore’s attractiveness when it comes to luring talent. “Despite a fall in the value of typical expatriate packages for middle managers, salaries are at their highest level in SGD terms for five years. Low tax rates also mean it remains an attractive location. Beyond salary incentives, Singapore will continue to be attractive to international talent as it is an attractive place to live and work,” he reckons.
AON regional marketing and PR manager for Asia Pacific Jini Pillai concurs and says, “The value of working in a regional location and the experience of working in Asia are significant non-monetary factors that global talent find attractive. In addition, a decline in wage increases in Western markets as well as a greater pool of skilled talent including local Singaporeans and expats from India and China have moderated increases in expat packages.”