Southeast Asia's stagnant incomes

Real wages among ASEAN-6 countries have remained broadly stagnant, with nominal increases offset by a rising cost of living. This is particularly the case for Indonesia, Singapore and the Philippines -- but even high-income Singapore is not immune.

Indonesian inflation, for example, reached 4.6% in 2023; that outpaced a 4.1% increase in nominal wage growth.

We charted wage growth in these six countries -- using 2022 levels as a base and then deflating them using the consumer price index (CPI). Between the drop in nominal wages during the COVID-19 pandemic and the spike in inflation that accompanied the subsequent monetary tightening, many workers are likely only slightly better off than they were three years ago.

We've previously examined this phenomenon in Malaysia, where the Penang-focused tech boom is so far having little beneficial spillover impact for workers in other sectors; the modestly-paying food industry is seeing the most job growth.