Hong Kong and Singapore forecasts drop significantly further than China
Pay rises across Asia Pacific are down 40% from those predicted prior to the global economic crisis. according to ECA International’s latest Salary Trends Survey. Levels in China have remained robust falling only a third below earlier forecasts, compared to 60% drops in Hong Kong and Singapore.
The survey found that pay increases for the Asia Pacific region will average 4.8% in 2009, 30% below last year’s 6.9% rises. Salaries in Japan, Taiwan, Hong Kong and Singapore have recorded the biggest downward adjustments with almost a third of Asia Pacific-based companies surveyed planning to put salary increases on hold.
“Asia Pacific has been severely affected by the economic downturn and this is reflected in how companies have planned their salary reviews in 2009”, said Lee Quane, Regional Director, ECA Asia. Singapore’s workers can expect salary increases of 2% compared with last year’s 5% increases, well below the regional average of 4.8% and almost two-thirds lower than initial forecasts. The same increase will be seen in Hong Kong and marks a return to levels last seen when SARS hit Asia. Approximately 36% of the companies surveyed in both cities said they will be freezing salaries.
Global view
Worldwide, salary increases are expected to fall from last year’s 6.2% average to around 4.7% as companies look for ways to cut costs in response to the global economic crisis. According to Quane “globally, companies have revised their forecasts down, on average, by more than a third.”
Despite the apparent reduction in salaries, the survey is not all bad news. “One thing to remember is that in the vast majority of locations surveyed, annual inflation figures today are also significantly lower than they were as oil and food prices have fallen from the highs they hit last year. In Singapore and Hong Kong, for example, current inflation is well below figures published six months ago. This means that real wage increases—the difference between actual salary increases and inflation—may not differ significantly from last year. In some locations they are, in fact, higher than they were despite salary increases being lower.”
Top five Salary Increases
Country Rank 2009 Rank 2008
Venezuela 1 1
Argentina 2 3
India 3 2
Vietnam 4 6
Egypt 5 6
Lowest Five Salary Increases
Switzerland 49 53
Canada 50 36
Irish Republic 51 31
Lithuania 52 17
Japan 53 52
Hong Kong and Singapore both ranked 43rd position in 2009, down from 31st in 2008 for Hong Kong and 25th for Singapore.
Paul Arkwright
Publisher
