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By June Loh
The hiring outlook for Singaporean companies is set to hit a four-year low by 2026, as companies take a more conservative approach amid an uncertain economic climate.
This finding was released by ManpowerGroup, who published findings from its quarterly Employment Outlook Survey on Dec 9, after surveying more than 500 employers in Singapore on their intentions to increase or decrease headcount in the coming quarter.
The survey uses a metric called Net Employment Outlook (NEO), which measures the difference between the percentage of employers expecting to increase staffing levels and those expecting to decrease them. For example, if 30 percent of employers anticipate an increase in staffing while 10 percent anticipate a decrease, the NEO would be 20 percent.
Singapore’s overall NEO for Q1 2026 stands at 15 percent after seasonal adjustment, representing a five percentage point decrease from the previous quarter (Q4 2025) and a 11 percentage point decline compared with the same period in 2024. The figure of 15 percent marks a four-year low, with the previous low occurring between 2021 and 2022, just after the pandemic.
Singapore’s outlook is comparatively more bleak when pit against the global outlook, which has a NEO of 24 percent.
MANPOWERGROUP
Cautious Hiring
Employers are erring on the side of caution in the new year. Almost half of them (46 percent) said they planned to keep staffing levels unchanged, while 18 percent anticipate they will cut staffing levels.
Linda Teo, country manager of ManpowerGroup Singapore, said: “More employers are focused on maintaining staffing levels or holding off on making staffing decisions while waiting to see how economic conditions evolve, while those hiring are doing so strategically, driven by organisational growth, diversity initiatives and maintaining a competitive advantage.”
Among those planning to reduce staff, 31 percent said market shifts have lowered job demand for certain roles while 30 percent attributed it to economic challenges. Meanwhile, 30 percent of employers have also pointed out that they are consolidating roles for operational efficiency, reducing the need to hire more manpower. Company restructuring (30 percent) and rightsizing (26 percent) were also cited as main factors.
Still, a sizeable group is expecting to increase hiring, with 32 percent of companies indicating so. Top drivers include organisational growth (39 percent), diversity initiatives (34 percent) and a desire to increase competitive advantage (31 percent). Surprisingly, only two in 10 respondents said automation has reduced the need for certain roles.
Among the sectors covered, finance and insurance recorded much higher demand than a year earlier. It has a NEO of 33 percent, up 23 percentage points from 2024. Construction and real estate followed with a 11 percentage point increase, while tech and IT services had a one percentage point increase. Other sectors like trade and logistics, the public sector, and utilities and natural resources showed lowered demand. The worst affected was manufacturing, which had a 13 percentage point decrease from 2024.
Wage Moderation
Employees might expect lower wage increments in 2026. In a separate survey conducted by the Singapore National Employers Federation (SNEF), 48 percent of employers surveyed said they plan to carry out wage moderation or wage freezes in the upcoming financial year, up 10 percentage points from the previous financial year.
Meanwhile, HR firms have indicated that the average salary increase in 2026 will be between three and six percent, although the outlook varies slightly across sources. The Straits Times reported that Aon and Persol said local companies are budgeting an average salary increase of about 4.3 percent for 2026, unchanged from 2025.
On the other hand, Robert Walters said employees could see an increment of three to six percent to match inflation, up from the projected two to five percent in 2025. ManpowerGroup said more employers plan to give salary increments of less than three percent in 2026 compared with 2025, while fewer plan increases of more than five percent, suggesting a downward trend in annual pay increments.
On the bright side, the majority of employers (96 percent) that hire lower-wage workers have plans to provide them with built-in wage increments in 2026. Nearly 40 percent of employers plan higher raises for lower-wage workers, while 33 percent will give similar increments across the board.
Hao Shuo, SNEF’s chief executive officer, said it was “heartening” to see employers continue to invest in their people, particularly lower-wage workers, as it helps build a “stronger, more resilient and future-ready workforce”.
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