Despite offering higher wages to lure Singaporeans to work as sales staff, the industry is still facing a manpower squeeze that has been especially painful over the festive shopping period.

Retailers The Straits Times spoke to said they have implemented wage increases of between 5 per cent and 10 per cent compared with last year, yet continue to be beleaguered by staff shortages.

Fewer people are applying to work at retailers such as Wing Tai Retail, which operates 160 fashion outlets including Karen Millen and Topshop.

Its spokesman said that between June and September, the number of applicants for its retail jobs fell by 52 per cent, compared with the same period last year.

This decline was in spite of higher salaries for its front-line retail employees. Part-time staff now earn $10 an hour on weekdays and $11 an hour on weekends. Previously, the respective rates were $6 on weekdays and $7 on weekends.

Increasingly stringent regulations on the hiring of foreign labour are also a key factor in the manpower crunch, retailers said.

The industry is highly dependent on foreigners. About half of all front-line retail employees here are foreigners, said Mr Josh Goh, assistant director of corporate services at human resources consultancy The GMP Group.

In July this year, the Government tightened foreign labour quotas in several industries, including the service sector. Firms are now allowed to have foreign workers fill up only 45 per cent of positions, down from 50 per cent previously.

Wing Tai also attributes the staff shortage to greater competition in the market, and the acceleration of expansion plans by existing brands.

Mr David Tang, chief executive of department store Metro, echoed this, saying more foreign retailers entering the local market meant higher industry demand for manpower.

But retailers said their hands are tied. The Wing Tai spokesman said the company has "limited affordability to 'hire at all cost' even in this tight labour market", as operating costs, including rent, have also been on the rise.

Ms Kiran Kaur, regional human resources director of Courts Asia, said that while less than 20 per cent of its employees in Singapore are foreigners, this ratio might not be sustainable in the long run due to difficulties in hiring Singaporeans.

The company increased the pay of front-line retail staff by about 5 per cent in April, in a bid to hire more Singaporeans put off by the long hours and physical demands of the job.

But attracting Singaporeans to work in retail continues to be "our greatest challenge", said Ms Kaur.

Despite the wage increases, those in retail continue to make less than their counterparts in other industries.

Mr Goh said front-line retail staff, who work for about eight to 12 hours a shift, typically earn a base salary of about $1,200 to $1,400, plus an average monthly commission of $200.

In comparison, non-graduates in other industries draw an average salary of about $1,600 to $1,800, a difference of 25 per cent to 45 per cent.

Many retailers, including home- grown shoe chain Charles and Keith, where foreigners make up 40 per cent of its workforce, have tried to plug staffing gaps with part-time staff.

But as a Charles and Keith spokesman said: "They do not have as much product knowledge as our full-timers due to their short stay."

The lack of front-line staff is making retailers like fashion and lifestyle distributor Jay Gee Enterprises wince at the lost opportunities in making a sale.

"This crunch affects us in all aspects - beginning with lost business opportunities with under-staffing, compromising on quality time to serve customers at the stores, and eventually business expansion," said its managing director R. Dhinakaran.

The Wing Tai spokesman said retail outlets require a "minimum headcount" to ensure basic customer service needs are met and store operations run smoothly.

Singapore Human Resources Institute executive director David Ang said relying on part-time staff does not solve retailers' long-term staffing issues.

He said more can be done to alleviate the physical demands of retail jobs.

"Companies could look into how they can design the work environment to be more friendly, for example, providing a chair so cashiers won't have to stand."

He added that companies could also do more to cultivate a sense of job ownership among employees.

Polytechnic student Elaine Tham, 19, who has worked as a part-time sales assistant during term breaks, said she would not consider a long-term career in the industry.

"I feel that career advancement is limited. I might consider working in retail if the pay was higher," she said.