Employees in Hong Kong in 2020 can expect an average salary increase of 1.4% in real terms – one of the lowest increases in the Asia Pacific region – according to ECA International’s just-released salary survey.
Despite this, salaries in the city are forecast to hold up surprisingly well.
“Despite nominal salary increases staying at 4.0% next year, the predicted drop in inflation from 3.0% to 2.6% implies that employees in Hong Kong will see a slightly better overall salary increase in real terms this year,” said Lee Quane, regional director for Asia at ECA International.
“Although this is still lower than the overall average in Asia Pacific, the fact that the nominal increase will remain at 4.0% in 2020, as it was last year, is surprising given the backdrop of the current economic situation in Hong Kong,” he added.
“However, this underlines the fact that many companies in Hong Kong need to continue to attract and retain staff even in this period of economic adversity for the city.”
China is also expected to be above the regional and global salary increase for 2020 average at 3.6%.
“Although there are signs that the Chinese economy may be slowing down in the face of the ongoing trade war with the US, wages and salary increases are still holding firm. China has also maintained its place in the global top 10 for salary increases,” said Quane.
The emerging economies of Vietnam and Thailand both saw significant real salary increases, placing them in the global top five, with increases of 5.1% and 4.1% respectively. Although India once again recorded the highest real salary increase in Asia – predicted to be 5.4%.
Another of the big winners for the upcoming year appears to be Singapore.
“Although the forecasted real salary increase is set to be slightly lower in 2020 than the 3.3% Singapore employees saw in 2019, they will still see a larger increase than their regional neighbours such as Hong Kong, Taiwan and Japan,” said Quane.
“The notably low level of inflation that Singapore has seen over the recent years, coupled with a tight labour supply and talent restrictions due to immigration constraints, implies that salary increases will remain relatively high.”