SINGAPORE: Salaries in Singapore are expected to stay mostly stable this year with some decreases expected in the financial services sector, according to the latest annual salary survey by human resource consultancy, Robert Walters.

The study showed that despite some companies in Singapore having announced retrenchments and imposed hiring freezes, firms across most commerce sectors have not yet felt the need to trim salary packages.

However, the hiring situation in the financial services market continues to remain tough.

Robert Walters said many banks have frozen recruitment, especially across operations and finance. In addition, hirings and salaries in the sector have also declined amid the fallout from the global financial turmoil.

The survey showed that wages of front office and operations staff may fall slightly this year compared to last year. Managing director of Robert Walters Singapore, Amanda Ross, said salaries in the sector will remain mostly flat.

Ms Ross said: "I don't think we'll see increases. I think we'll see minimal increases for critical positions or very key positions, that is, financial services for your control areas because there's an increased focus on your controls and risk.

"But within banking operations, we're not seeing salary cuts or anything like that. If anything, they'll let people go, but we're not seeing drastic cuts in those salaries.

She expects headcount to be tight across all sectors this year as most companies will be focusing on improving efficiency and productivity.

Another trend is that the demand for contract workers has risen amid the economic downturn.

The study showed that while the use of contractors was more common in the past in the technology sector, there has been an increase in demand for such workers in finance, human resources, compliance and marketing areas.

It said many permanent roles are now offered on a contract basis as employers are unable to increase permanent headcount.