SINGAPORE: Workers in Singapore can expect pay rises of about 2.7 per cent next year after inflation is taken into account, according to a survey released by human resources firm ECA International on Tuesday (Nov 14).
The annual poll noted that employers in Singapore are prepared to raise wages by about 4 per cent in 2018 – same as last year but higher inflation is “reducing real-term pay awards”.
“Over the past few years, inflation in Singapore has increased while nominal salary increases have stayed flat, which has had the effect of slowly eroding pay rises in real terms,” said Mr Lee Quane, director for Asia at ECA International, which released the annual survey involving 260 multinational companies from 72 countries. In Singapore, more than 110 firms were polled.
With inflation predicted to reach 1.3 per cent in 2018, workers can expect to see a real salary increase of 2.7 per cent.
In comparison, last year’s survey predicted a real wage increase of 2.9 per cent in 2017 after taking into account inflation of 1.1 per cent.
Despite this, the salary increases in Singapore for 2017 and 2018 are higher than those in Hong Kong and compare favourably with other developed economies in the region and globally, the survey noted. For 2018, workers in Hong Kong will likely see real wages rise by about 1.8 per cent.
“This reflects the fact that the Singapore economy continues to perform well on the back of global economic recovery,” said Mr Lee.
WORKERS IN INDIA TO SEE HIGHEST PAY RISES
Elsewhere, workers in India are likely to see the highest pay rises across Asia, with real wage increments predicted at 4.9 per cent in 2018.
Despite the lingering economic slowdown, China is also among the top Asian countries in terms of rises in real wages. Companies are expected to bump up employee salaries by 6 per cent next year and after stripping out inflation, real wages are estimated to rise 3.6 per cent.
“A forecast average rate of increase in China of 6 per cent is higher than the 5.5 per cent awarded on average in 2017,” noted Mr Lee. “This points to improved business sentiment in China, which perhaps shows that employers are more positive for the prospects of both the domestic and global economy in 2018.”
In Malaysia, low unemployment and a strong economy have kept nominal wage increases above 5 per cent for several years and this will continue in 2018, the survey said. With inflation expected to fall back slightly, employees can look forward to a boost in real salary increases to 2.3 per cent next year.
On the other hand, bosses in Japan are set to hand out salary increments of 2.2 per cent next year - the lowest rate of pay rise in nominal terms across Asia. But with inflation remaining low in Asia’s second biggest economy, workers can expect to see real wage increment of 1.7 per cent.
On average, salaries in Asia are expected to increase by 5.9 per cent in 2018. Factoring in inflation, real wage rises in the region will average 2.8 per cent, higher than other parts of the world.