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Singapore real wages expected to grow 3% in 2019: Korn Ferry
SALARIES in Singapore are expected to grow by 3 per cent in 2019 after adjusting for inflation, according to a forecast by consulting firm Korn Ferry.
This is up from the 2.3 per cent predicted for 2018, driven by the demand for highly-skilled workers which has put pressure on wages.
The report revealed that the highest projected base salary movements were seen in the oil and gas sector with growth of 3 per cent in 2019, followed by transportation, high-tech, chemicals and the public sector – all at 2 per cent. On the flipside, the industrial goods sector is projected to see the lowest increase at close to 1 per cent.
But pay increases do not seem to be in line with demand for some sectors. Despite 38 per cent of organisations indicating that they lack engineers and 29 per cent which say they lack information technology talent, salary increases for staff in these functions range from 2.8 to 3.4 per cent, in line with the general market increase instead of an expected salary premium given the lack of talent shortages for these roles.
The study also found that performance ratings of employees and variable bonus payouts are not necessarily aligned.
Results showed that there is little differentiation in terms of actual bonus payouts between an employee who receives an above or below expectation performance rating.
The projected average variable bonus payment to be paid out by organisations across industries in Singapore increased to an average of 2.2 months in the latest study, compared to a slightly lower payout of two months last year.
In Asia, real wage increases are expected to be 2.6 per cent in 2019, the highest in the world. However, this is slightly down from the 2.8 per cent last year.
China’s real-wage forecast growth for 2019 weakened at 3.2 per cent, down from 4.2 per cent last year. Japan saw a real-wage prediction of 0.1 per cent for 2019 compared to the 2018 prediction of 1.6 per cent.
While growth in Asia is easing slightly, India, Vietnam and Singapore are exceptions to the rule.
Globally, real-wage salaries are expected to grow only an average of 1 per cent in 2019, dipping further from a 1.5 per cent prediction for 2018.