Salaries in Hong Kong are expected to increase 4.6% in 2016—which remains stable with the 4.5% increase that has taken place this year, according to Aon Hewitt. The news comes at a time when economies in Asia have seen gradual GDP growth this year with Hong Kong projected to see 2.1% growth in 2016 which is the same as predicted for 2015.
Hong Kong in particular has been hit by the slowing down of exported goods which has impacted industries such as transportation, logistics and shipping, all of whom are expected to see salaries increase in 2016 by 3.9%. This is down from 4.1% in 2015 and will see the smallest increase amongst all sectors. Hospitality, restaurants and travel will also take a hit next year as inbound tourism has fallen this year—with wage increases expected to be the second lowest in 2016, down to 4.1% from 4.2%.
The results are forcing firms to think about consolidating their existing workforce—with some low performing employees being let go or even having their employee benefits frozen. Gary Chin, Rewards Practice Lead, Aon Hewitt Hong Kong noted, “Overall, variable pay has slightly gone down, due largely to weakened business performance. Given finite budgets, employers are still attempting to differentiate merit increases and bonuses by performance level, although the variance in terms of the amounts received by top performers and their average performing counterparts have narrowed. This poses motivational and retention challenges to employers.”
Construction and engineering and life sciences on the other hand are expected to see more positive results with salaries expected to increase by 5.1% and 4.9% respectfully—this is up from 4.9% and 4.8% this year.
Paul Arkwright
Publisher
