Digital skills deliver up to 30% wage premium in Singapore, new study finds

Digital skills are becoming one of the strongest determinants of wages in Singapore, with workers possessing advanced digital capabilities earning a 30.1% wage premium compared with employees in similar roles who have lower levels of digital proficiency, according to new research from Indeed Hiring Lab and the Asian Development Bank (ADB).

The study, which analysed job postings between 2019 and 2024, found that the financial rewards associated with digital skills extend across the labour market and are no longer confined to traditional technology roles.

Researchers identified a clear relationship between digital proficiency and wages. Jobs requiring intermediate digital skills carried a 12.1% wage premium, while even positions requiring basic digital skills offered salaries that were 4.6% higher than comparable roles without digital requirements.

The findings suggest that digital capabilities are increasingly influencing pay levels regardless of occupation.

Unlike previous studies that linked higher wages to technology-focused jobs, the latest analysis compared vacancies within the same job titles and companies while controlling for factors such as location, firm, pay structure and other job requirements.

The results indicate that employers are directly rewarding digital competencies rather than simply paying more for technology-related positions.

The study classified digital skills into three categories. Basic skills included competencies such as using email, spreadsheets and office software. Intermediate skills covered areas such as customer relationship management systems, data analysis, dashboards and digital content management. Advanced skills included programming, artificial intelligence, machine learning and IT systems management.

Researchers found that the wage gap widened significantly as digital complexity increased, with advanced skills generating a premium more than six times higher than that associated with basic digital capabilities.

"Digital skills are becoming increasingly important across the labour market, not only in technology-intensive occupations," said Silvia Garcia Mandico, economist at the Asian Development Bank and co-author of the study.

"Our results show that employers attach a clear wage premium to these skills even when comparing otherwise similar jobs, and that the premium rises with the level of digital proficiency."

The report also highlighted the growing importance of artificial intelligence in the labour market.

Singapore emerged as one of the economies with the highest levels of demand for AI-related skills among the six countries included in the study, which also examined Australia, India, Malaysia, the Philippines and South Korea.

Demand for AI-use skills among jobs requiring intermediate and advanced digital capabilities more than doubled between 2019 and 2024.

The research found that AI requirements are increasingly appearing outside the technology sector. Occupations in banking, finance, insurance, legal services, industrial engineering, social sciences and the creative industries are all incorporating AI-related competencies into job requirements.

While AI development remains concentrated in technical occupations, the ability to use AI tools is becoming a mainstream workplace skill.

"The labour market is increasingly rewarding what people can do with technology, not simply whether they work in a technology role," said Yusuke Aoki, economist at Indeed Hiring Lab.

"As AI becomes embedded in more workplaces, the ability to apply digital and AI tools effectively is likely to become increasingly important across both technical and non-technical careers."

The report analysed approximately six million job postings from Indeed across six Asia-Pacific economies. Researchers used AI models to classify digital and AI-related skill requirements and examined how these requirements affected advertised wages.

The findings reinforce Singapore's broader push towards digital transformation and suggest that continuous upskilling will play an increasingly important role in determining career opportunities and earnings as AI adoption accelerates across industries.