SOME SMES UNDERESTIMATE MARKET WAGES
Cheow Xin Yi
AN ANNUAL survey of small and medium enterprises (SMEs) suggests that some of them – especially in the finance and manufacturing sector – are underestimating the average market wages.
Out of the 1,206 SMEs surveyed by DP Information Group, the credit and business information bureau, 68 per cent claimed to have paid the market average in terms of staff salary and benefit packages, while 16 per cent stated that they pay above market average.
However, a comparison of their actual wages to the market average, obtained from Ministry of Manpower (MOM) statistics, showed a certain dissonance between perception and reality, said Ms Chen Yew Nah, DP Information Group’s managing director.
While SMEs in the commerce (wholesale), property and service sectors pay workers above market average, the wages in six other sectors are below average.
For example, respondents from the finance sector pay their workers an average of $4,252, nearly 30 per cent lower than MOM’s market average of $5,949. Those in manufacturing are paid $2,935, about 15 per cent lower than the market average of $3,495.
In construction, the shortfall is about $300, or 12 per cent, while in the communications, transport and storage sector, it is about $350, or 10 per cent.
While it is beneficial for SMEs to realise the gaps in their wage scale and try to move it up accordingly, Ms Chen said it may be difficult for them to do so due to cost mechanics. For them, a more sustainable solution to recruiting and retaining talent is to increase training opportunities for their staff, she said.
“People may stay in companies for different reasons other than wages, and do not mind working in SMEs at say, 15 per cent below market price, if they are given ample opportunities to upgrade and improve their competency,” she said.
So.. are you underpaid?