Salaries across Asia-Pacific to rise by 7% in 2015 – survey
MANILA, Philippines – Global professional service company Towers Watson said that Philippine companies are seen to raise salaries by 2015, at a pace with the average increase in the Asia-Pacific region.
If that happens, you could be receiving a 7% increase in your salary next year.
"… With the country's continued economic growth forecast and foreign investment continue to flow in, companies are able to justify a good salary increase for their performing employees," said Vangie Daquilanea, Data Services manager, Towers Watson Philippines.
Based on the APAC Salary Budget Planning Report, India and Myanmar are also standouts for 2015. Vietnam is highest with 11%, followed by India at 10.8%, and Myanmar 10%, in terms of overall increases (before inflation is factored in).
Yet, inflation erodes the real benefit in these countries to 4.1%, 3.5%, and 3.3% respectively.
China has an overall salary increase forecast of 8.3%, but this is supported by relatively low inflation expectations at 3.1%.
Hong Kong and Singapore are both set for overall increases of 4.5% in 2015, unchanged from 2014.
But after inflation, Singaporean employees will see more of that increase. In real terms, salaries will rise 0.9% and 2.2% respectively.
Japan will see the smallest raises at 0.6%.
But pick-up in inflation in the region means that pay increases in real terms will drop slightly.
Employees across the region, from factory floor to senior management, will have pay raises equal to or higher than last year in percentage terms, with the exception of Taiwan, where the rate of increase will drop from 2.8% to 1.7% after inflation.
Sectors with salary increases in 2015
The pharmaceutical sector will continue to have the highest salary increase in the region at an average of 6.7%. Vietnam (12%), India (11.5%), and China (8.9%) will see the highest pay increases in this sector.
Compensation at financial institutions though has become a major concern for governments and the general public as a consequence of the recent global financial crises,” said Sambhav Rakyan, Data Services practice leader, Asia Pacific at Towers Watson.
“Discussions have been raised to regulate bankers’ compensation, especially for those whose daily job tasks include risk taking that can have a significant financial impact on the bank,” Rakyan added.
The high-tech sector in the region is also expected to see raises on average of 6.6%, up from 6.3% in 2014. Across all job levels, salaries are expected to rise.
The high-tech sector is emerging from the cost pressures of the past with new-age technology companies wooing the top talent with high salaries, flexible, and “cool” work environments.
In real terms, however, increases will be lower for 12 of 20 Asia-Pacific economies covered in the survey.
But attrition rate is also seen to rise at 15% in the Philippines – higher than the regional average of 9%.
Although some companies offer market competitive salaries to lure key talents, equal importance should be placed in retaining these finds.
“Availability of the opportunities for career progression is considered as top retention factor by the employees, hence, programs that will support this should be in place," Towers Watson said.
Towers Watson is also seeing an upturn in economic growth in Asia-Pacific by next year against a backdrop of declining unemployment, which is seen to create inflationary pressures, Towers Watson said.
“"The challenge for companies is to keep employees engaged and turnover down, while not getting caught up in a pay-inflation spiral,” said Sambhav Rakyan, Data Services practice leader, Asia Pacific at Towers Watson.
Rakyan acknowledged that salary is the no. 1 driver for attracting and retaining highly skilled staff, “so a fine balance needs to be found."
The survey is released in time with the companies’ budget planning process for 2015. The survey was conducted in July 2014 with approximately 2,900 sets of responses were received from companies across 20 countries in the Asia-Pacific region. – Rappler.com