Average pay rise of 7.3% forecast for Asia-Pacific
SALARIES across the Asia-Pacific region are expected to increase by an average of 7.3 per cent in 2015, with wages in Thailand expected to rise by 5.9 per cent, according to a recent labour-market study.
“Asia-Pacific’s emerging markets continue to lead the world in terms of real wage growth, with salary increases just 10 per cent lower than pre-financial-crisis levels, compared [with] the US and Europe, which remain 20-30 per cent adrift,” global consulting firm Mercer said.
Salaries in India and Vietnam are expected to increase by double digits this year (10.8 and 10.3 per cent respectively), the highest levels in the region, followed by Indonesia (9.4 per cent), China (7.9 per cent) and the Philippines (6.5 per cent).
Other countries and territories included in the study were Thailand, where salaries are expected to go up by 5.9 per cent, Malaysia (5.7 per cent), South Korea (4.9 per cent), Hong Kong (4.6 per cent), Singapore (4.1 per cent), Taiwan (3.9 per cent), Australia (3.5 per cent) and Japan (2.2 per cent).
Salary figures and forecasts are based on Mercer’s total-remuneration and salary-movement snapshot surveys and biannual market-pulse surveys. However, Mercer also points to “real wage growth” as an important indicator.
“While salary increases in some emerging markets across the region remain at double digits or high single digits (Vietnam, India and Indonesia), real wage growth (which is measured as salary increases minus inflation rate) still remains low, due to high inflation rates in these countries,” Mercer said in a statement.
In the Philippines, for example, with the inflation forecast at 2.5 per cent, real wage growth is predicted at only 4 per cent. But on the whole, salary increases for 2015 are expected to be higher than inflation across the Asia-Pacific region, resulting in real wage growth, the Mercer study found.
“It is important to keep growth rates in perspective,” Mercer partner Puneet Swani said in a statement. “While real wage growth is good news for emerging markets, on a percentage basis, absolute salary levels are still low in these countries, compared [with] more developed markets.”
The study also found that the technology industry had the lowest salary-increase forecast for 2015 in eight of the 14 countries and territories analysed.
Meanwhile, the study also showed that the life-sciences industry had the highest salary increases forecast in seven out of the 14. The study also revealed doubt-digit turnover rates in almost all Asia-Pacific countries, except in Japan and South Korea.
“Despite the recent stabilisation in voluntary turnover rates, the rising numbers represent a major challenge in terms of replacement costs in the form of higher salaries for new joiners, recruitment costs and lost production, ” the study said.
