- Asia expects to see highest real-wage growth globally
- Holistic approach advised when determining pay amidst rising trade tensions
Real-wage salaries in Asia are forecasted to increase by 2.6% in 2019, according to recent findings from Korn Ferry. The increase will be the highest globally and exceeds the expected global average real-wage salary growth of 1%. In Hong Kong, the real-wage salaries are forecast to increase by 1.7% this year, similar to predictions in 2018.
Robert Li, Senior Client Partner, Korn Ferry reported, “With inflation rising in most parts of the world, we’re seeing a cut in real-wage increases across the globe. Asia has managed to maintain a similar salary increase forecast as last year, driven by the strong economic outlook in this region and projected subdued inflation.” He added, “In addition, the Greater Bay Area (GBA) initiative has brought optimism and is expected to have a further positive impact on Hong Kong and China economies in the long run.”
Although the GBA initiative should continue to boost salary increase expectations, the actual percentage of salary increases will ultimately depend on how the global and China economies perform which is marred by uncertainty due to rising trade tensions with the USA. Li advised organisations to take a holistic approach when determining pay; he said “While inflation indices are a solid benchmark for reviewing market trends in pay, we recommend that companies 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.”
Paul Arkwright
Publisher
