MEF Salary Survey reveals lower salary hikes for Malaysian executives

The latest Malaysian Employers Federation (MEF) Salary Survey for executives and non-executives reveals that employers have granted lower salary increases and bonuses throughout 2016 with the forecast for 2017 looking just as bleak, as reported in the press release.

Speaking at the launch, MEF president Y.Bhg. Tan Sri Azman Shah Dato’ Seri Haron stated that 93.6% of respondents granted salary increase to executives as compared to 96.5% in 2015, while it was 95.4% for non-executives (96.5% in 2015).

“The average salary increase for executives in 2016 was also lower at 5.55% (5.97% in 2015), but it was slightly higher at 5.51% for non-executives (5.44% in 2015). The overall average forecasted salary increase for executives in 2017 is 5.30% as compared to 5.55% in 2016, while it is also forecasted lower at 5.43% in 2017 (5.51% in 2016) for non-executives,” said Tan Sri Azman.

Adding on as he touches on the topic of bonuses, “only 63% of respondent companies granted bonus to all executives as compared to 74.4% in 2015, and for non-executives it’s 61.3% compared to 72.6% in 2015. Average forecasted bonus for 2017 also dipped for executives with 2.15 months (2.3 months in 2016) but increased for non-executives with 2.11 months which was higher than the 1.97 months of actual bonus in 2016,” he said.

Tan Sri Azman also launched the MEF survey on management of foreign workers, the MEF survey on managing employees during economic downturn, the MEF fringe benefits survey 2016 and the MEF analysis of collective agreements on terms and conditions of employment 2015.

The MEF survey on management of foreign workers noted that the “high turnover rate of local employees was the main reason employers opt to recruit foreign workers (85.2%)”.

Not only that, respondents of the survey noted how “foreign workers were willing to work harder (76.4%), and due to difficulties in recruiting locals to perform 3D jobs (72.4%).” The term 3D is typically abbreviated from 'Dirty, Dangerous and Demeaning', derived from the Japanese expression 3K: kitanai, kiken, kitsui (respectively 汚い, 危険, きつい).

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As for the MEF survey on managing employees during economic downturn, 83% of companies indicated being affected by the economic downturn in 2016.

Some of the common HR strategies adopted included to control overtime work (78.2%), to freeze new recruitment except for critical areas (75.5%), to limit work on weekly rest days and public holidays (50.9%), to reduce usage of electricity/water (50%), and to reduce outstation business travel (40.9%).

The survey also revealed that 12.7% of the respondent companies implemented retrenchment during the current economic slowdown, 8.2% offered VSS, 5.5% introduced MSS, while 3.6% implemented temporary lay-off. None had implemented pay cuts.

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