Attrition rose by a steeper margin in 2025, compared with the prior year’s increase
[SINGAPORE] The attrition rate in Singapore quickened this year while wage growth remained more or less stable, a survey by professional services firm Aon found.
Across Singapore, the overall budgeted salary increase for 2026 is projected to be 4.3 per cent, unchanged from salary growth for 2025, according to Aon’s 2025 Salary Increase and Turnover Study, which surveyed over 700 companies across South-east Asia.
The life sciences and medical devices sector recorded the highest salary growth projections among all industries at 4.6 per cent, above overall projections for Singapore.
Projected wage growth for the consulting, business and community services sector also surpassed the national projections and stood at 4.4 per cent. This was followed by sectors such as technology (4.3 per cent), manufacturing (4.2 per cent), retail and hospitality (4.1 per cent), financial services (3.9 per cent) and energy (3.5 per cent).
Across South-east Asia, the technology industry is expected to record the steepest wage growth in 2026 across sectors in Vietnam (7.1 per cent) and Indonesia (5.9 per cent). Meanwhile, the consulting, business and community services sector is projected to lead salary increments for Malaysia, at 4.8 per cent.
Rising attrition in Singapore
Attrition rates for Singapore quickened in 2025 as the year recorded a steeper rise in overall staff turnover. The survey found that Singapore’s attrition rate grew to 19.3 per cent in 2025, from 16.7 per cent in 2024, climbing by a greater margin than the previous increase from 16.5 per cent in 2023.
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Voluntary turnover, in which employees opt to leave firms for reasons such as retirement, career advancement or personal preference, accounted for 12.7 per cent of overall attrition numbers in 2025 for Singapore.
Meanwhile, the remaining 6.6 per cent was due to involuntary turnover, cases of employee exits due to factors beyond their control, such as layoffs, poor performance, misconduct, or organisational restructuring.
The retail and hospitality sector in Singapore recorded the highest involuntary turnover rate at 7.3 per cent, surpassing the overall average of 6.6 per cent.
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This was followed by the technology sector, with an involuntary turnover rate of 6.8 per cent, manufacturing (5.1 per cent), life sciences and medical devices (4.9 per cent), financial services (2.8 per cent) and consulting, business and community services (1.3 per cent).
Manpower challenges
Talent retention is emerging as a priority of firms amid manpower problems for South-east Asia companies, as 42 per cent of firms surveyed reported challenges in hiring and retention, Aon said.
Rahul Chawla, partner and head of talent solutions for South-east Asia at Aon, highlighted that as companies “increasingly (focus) on retaining top talent and highly skilled employees”, the need to balance rising compensation costs is key. He noted that firms are deploying rewards strategies to address.
Evon Lock, head of data solutions for South-east Asia at Aon, pointed to firms adopting “targeted hiring salaries” and salary increments to engage top-performing staff and build resilient teams.
This comes despite hiring and retention pressures, as companies are prioritising productivity gains while navigating an uncertain business landscape, Lock said.
The survey found that companies are turning to monetary incentives as part of their strategy to attract talent and engage top performers while they battle manpower challenges.
Notably, higher base pay packages emerged as a top tool deployed by firms, used by 73 per cent of those surveyed.
This was followed by one-time payments, such as sign-on bonuses, cited by 38 per cent; and variable bonuses or incentives, which 35 per cent reported using.
Skills gap challenges were another pressing issue, cited by 63 per cent of firms surveyed, Aon said.
Roles in information technology and sales were the hardest to fill, with 24 per cent of companies naming these two positions as in-demand jobs.
Artificial intelligence and machine learning roles also ranked among the most sought-after jobs, cited by 21 per cent, followed by cybersecurity (20 per cent) and engineering (19 per cent).
