Good news for staff in Malaysia! Salaries are projected to increase by 5.2% in 2019, according to the Malaysia 2018 Salary Increase & Total Compensation Measurement™ Survey by Aon. This marks a slight increase from 2018 where salaries were found to increase by 5.0%.
The survey noted that wages in Malaysia are increasing faster than in Singapore (3.8% in 2018) and in line with Thailand where salaries increased by 5.2% in 2018.
Aon also noted that the Malaysia economy is remaining resilient amid volatility in global financial markets and oil prices, as well as alongside the rising trade conflict between its largest trading partners (China and the United States). A GDP growth of 5.0% has been projected in 2019.
Prashant Chadha, Managing Director, Talent, Rewards and Performance, Aon Malaysia & Philippines, commented: "In the face of a growing economy and steady salary increases, employers must rework their compensation packages to ensure they can continue to attract and retain the best talent in Malaysia. An organisation’s best performers are often able to command premium pay – and ultimately, play key roles in driving strong business results."
Additionally, the survey found that fresh graduates working in tech and engineering-related fields as well as professionals with specialist skill sets enjoy a pay premium above general industry average.
Fresh graduates in the engineering, telecommunications and high-tech industries take home a premium of 12.1%, 21.3% and 23.0% respectively, with engineering and project design roles offering the highest starting salaries at over RM 3,500 a month.
Meanwhile, those working in IT services and e-commerce roles are paid 5.7% and 6.5% above the general industry average.
Professionals with specialist skill sets such as legal managers also enjoy pay premiums, taking home 16% more than the market average.
At the same time, employers are also looking at key attributes such as innovation, critical problem-solving, and strong business acumen. This is demonstrated by the pay premiums in the engineering and tech-related industries. For example, project managers in those industries earn 7% more than market average, while planning and business development managers take home 9% more.
Rahul Chawla, Practice Lead, Talent, Rewards & Performance, Aon Malaysia, said: "As the country's economy grows, employers must look to align their rewards practices with those of developed economies. Performance-driven rewards systems have become the norm, and productivity bonuses, sales incentives, and long-term incentives (LTI) are increasingly prevalent among Malaysian employers. These must be backed by fair performance assessment processes and robust corporate governance."