Asian salary hikes in 2018 modest, but leading the world, says Korn Ferry

In Asia, salaries are forecast to increase by 5.4 per cent – down from 6.1 per cent last year. Inflation-adjusted real-wage increases are expected to be 2.8 per cent – the highest globally, but down from 4.3 per cent last year. 
China remains consistent, with real-wage increases predicted at 4.2 per cent for 2018, compared to 4 per cent last year. Most countries in this region saw a drop in year-over-year real wage prediction increases, including Vietnam’s forecast of 4.6 per cent, down from 7.2, Singapore’s 2.3 per cent, down from 4.7, Japan’s 1.6 per cent, down from 2.1, and Thailand’s 4.5 per cent, down from 5.6.
Adjusted for inflation, employees around the world are expected to see real wage increases of only an average of 1.5 percent, down from 2017’s prediction of 2.3 percent and 2016’s prediction of 2.5 percent.
“With inflation rising in most parts of the world, we’re seeing a cut in real-wage increases across the globe,” said Bob Wesselkamper of Korn Ferry. 
“The percentage of salary increase or decrease will vary by role, industry, country and region, but one thing is clear: On average, employees are not seeing the same real-pay growth they did even one year ago.
“Slower economic growth in mature economies keeps a check on pay rises,” said Wesselkamper. “In emerging economies, upskilling workers is crucial for companies to maintain a competitive advantage, and those skilled employees can expect to see wages rise as talent shortages in certain regions drive salaries upward.”
His colleague Benjamin Frost noted that inflation indices were “a solid benchmark” for reviewing market trends in pay, but said their firm advises companies to “take a broader perspective by defining and agreeing upon their own measures of cost drivers, business strategy and local trading conditions”. 
“Compensation programmes need to be regularly reviewed to make sure they align with changing business and market conditions.”