Despite being higher than last year’s rise of 0.6%, wages in Hong Kong will rise only 1.3% on average in 2015 after inflation is taken into account, the third lowest increase in the region, after Macau and Japan. This according to the new Salary Trends survey from ECA International.
On average, salaries in the region are expected to increase by 7.2 per cent in 2015. But factoring in inflation, real wage rises in Asia will average 2.7 per cent—higher than the other regions surveyed.
Pay rises in mainland China are still considerably higher than in Hong Kong. Companies there are planning to award 8% salary increases again next year, with employees based in Guangzhou set to get the most generous uplifts. Even after inflation, staff in China will be among the best off within the region and globally—they can expect to see increases of 5.5 per cent in real terms.
Lee Quane, regional director—Asia, ECA International explained, "Despite slower growth in China, wages continue to rise at a significant pace reflecting the ongoing need to attract talent. Each year we see the salary gap between mainland China and Hong Kong narrowing, which is consistent with the general trend within the region of wage levels in developed and developing economies getting closer. While there are fears that pay inflation is causing multinationals to relocate out of China, alternative locations which offer both cheaper wages and the necessary infrastructure are still limited."
Asia—winners and losers
The biggest pay rises in the region have been forecast in Pakistan. Companies there are anticipating 12% rises on average. However, once inflation is taken into account Pakistan falls to third place in the list.
Employees in Japan will see the region’s lowest wage hikes next year. While much of the 2.3% increase is likely to be eroded by inflation, many workers there will feel slightly better off in 2015 than this year when pay increases have, on average, been below inflation.
In real terms, it is staff in Vietnam who will feel the best off in Asia. In contrast, employees in Macau will see their wages decrease—the only location in the region likely to experience that in 2015.
Companies in Taiwan and Singapore are anticipating raising salaries in 2015 at the same rate as they have this year (4% and 4.5% respectively). However, with inflation expected to rise in both locations next year employees will experience lower increases in real terms than in 2014.
In Myanmar salary forecasts for 2015 will be above the regional average as companies look to attract the staff needed to develop the country’s newly opened-up economy. Good news, too, in terms of real wage increases which will be higher than this year’s.
Global Markets
According to company predictions from around the globe, wages will rise 5.8% on average in 2015, slightly up on this year’s 5.6% average.
In the US and Canada, companies are predicting 3% wage increases—the same as this year’s uplifts. In Europe, the biggest pay rises will be in Ukraine and Russia, although wages in the region will rise 3.5% on average—the same figure as in Australia. Employees in the Middle East are set to see wages rise 4.7% on average.
Paul Arkwright
Publisher
