The latest research shows that wage growth for workers in Asia will be higher in 2023 as persistent inflation and labor shortages push up wages.
From India to Vietnam, employers are being forced to improve compensation packages or risk losing talent to competitors. The expected wage growth also exceeds inflation forecasts for 2023, giving hope for real income growth in Asia after this year’s cost of living. Average wage increases in industries are budgeted for next year in Indonesia, Malaysia, and the Philippines.
According to the New York stock exchange stock market services firm Aon 7% in Singapore, 5.1% in Thailand, and 7.9% in Vietnam.
All figures are higher than 2022 prices, except for Malaysia, which is flat.
Those predictions came from a study published this month in which Aon surveyed more than 700 companies in the Southeast Asian Community about wage changes and turnover.
The study highlighted that while inflation plays an important role in wage changes in the ASEAN bloc, the changes are also driven by supply and demand in the talent market. This year’s high attrition rates are putting pressure on employers to raise wages to facilitate recruitment. and conservation.
“Companies need to define their wage growth path to 2023 within the competitiveness of their current wage levels,” said Rahul Chawla, head of human capital solutions for Southeast Asia at Aon. “While it is important for companies to define and adjust salaries for different types of employees and the nature of work, organizations must remain agile in rethinking their salary policies.”
Research published last month by the consulting firm Mercer also found signs of rising wages next year. Mercer’s Total Compensation Survey found that all Asia-Pacific markets are expected to see average wage growth of 4.8 percent in 2023, up slightly from 4.6 percent in 2022.
Mercer’s findings, however, showed differences between countries. The highest projected wage growth for next year was 9.1% in India, while the lowest was 2.2% in Japan. However, both figures were slightly higher than this year, when India’s rate was 8.79% and Japan’s was 2.1.%.
Mainland China, at 5.38%, was the only market to forecast a slight decline in 2023 from 5.4% in 2022 as Asia’s largest economy struggles with a difficult growth outlook. Hong Kong’s wages are forecast to rise by 3.71% next year, compared with 3.55% this year, the Mercer survey showed.
In most cases, Mercer’s survey also found that wage growth expectations in the region will exceed projected inflation rates until 2023.
For example, next year’s inflation is 5.1% in India, 1.4% in Japan and 2.2% on the continent, according to the study. in China, and 2.4% in Hong Kong.
While the projections promise relief for workers worried about rising costs, some may be looking for more. In a global salary survey published last month, recruitment firm Robert Walters found that those who move to work in Singaporeans can expect a salary increase of 15 to 20 percent, and up to 40 percent for those with specific technical skills.
Singapore 80% of workers were likely to demand more pay, while 71% expected employers to take the cost of living into account when assessing pay rises or bonuses over the next 12 months.
Robert Walters surveyed 316 applicants and 105 companies in Singapore in September and found that more than 78% of employees surveyed were willing to consider changing jobs next year if their salary increases were below inflation. However, wages are not necessarily the only problem.
“For many candidates, money is no longer the only factor in career decisions,” said Monty Sujanani, Singapore country director at Robert Walters. “We’ve found that when employees feel tired or burned out because they’re not learning anymore, it pushes them to look for other opportunities.”