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The highest pay increases in three years – plus historically low inflation rates – mean employees across the world can anticipate average salary increases of 2.5% in 2016, net of inflation.
Asia, however, surpasses the global average, where real wages are expected to rise by 4.2% – the highest globally, Korn Ferry Hay Group’s annual salary forecast.
Within the region, Vietnam leads the way with the largest real wage increases forecast at 7.3%.
China and Thailand are not too far behind, at 6.3% and 6.1%, despite China’s economic slowdown, plummeting stock markets and reduced exports.
Seeing the benefit of being a part of the fastest growing major economy, Indian workers are forecast to see the highest real wage increase in the last three years, at 4.7% compared to 2.1% last year.
Salary forecasts for Asia in 2016:
- Vietnam – 7.3%
- China – 6.3%
- Thailand – 6.1%
- Philippines – 5.2%
- India – 4.7%
- Korea – 4.3%
- Malaysia – 3.9%
- Singapore – 3.7%
- Indonesia – 2.4%
- Hong Kong – 1.4%
- Japan – 1.0%
Philip Spriet, global MD of productised services at Hay Group, said that despite Asia driving the growth in wages, the global labour market is in flux as the aging workforce in advanced economies takes hold.
“In emerging economies, upskilling workers is crucial for companies to maintain competitive advantage. Those skilled employees can expect to see wages rise as talent shortages in certain regions drives salaries up,” he added.
In addition, Dr Mana Lohatepanont, MD for Southeast Asia at Hay Group, noted Vietnam has topped the region’s real wage increase at 7.3% due to employers giving high salary increases in a competitive talent market.
Over at Singapore, the low increment projection is in line with muted business sentiments amid a global slowdown and businesses adopting a still-cautious outlook.
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