The Asia Salary Guide report from Hays has identified a more conservative outlook for hiring and compensation in 2020. The recruitment company believes this is due to a slowing global economy which has seeded uncertainty within the region. In Singapore, employees remain realistic in their salary expectations but consider work/life balance and company culture equally important for retainment.
This year marks the 13th edition of the annual Hays Asia Salary Guide. The salary and hiring insights, including a thorough market overview of business outlooks, salary policies and recruitment trends, are based on survey responses from close to 6000 working professionals located in the five Hays operating markets in Asia; namely China, Hong Kong SAR, Japan, Singapore and Malaysia.
In Asia Organisations are gearing up for uncertainty. Despite optimistic projections, 2019 meted out market uncertainties that had some industries bracing for impact. This is most evident by the majority of employers in the region (42 per cent) expecting a softening general outlook for their local economy in 2020, marking a decisive turn from the ‘static’ outlook that was voted consecutively for the last three years. An increasing number of companies also expect to give no increments to their employees in 2020, a number that climbed from six per cent in 2017 to 17 per cent in 2019. And while most employers still plan to award more than 50 per cent of their staff with bonuses (44 percent), more employers also plan on giving no bonuses in the coming year (14 per cent), as compared to last year (11 per cent).
Such an outlook will necessitate transformation, says Hays, both in organisational structures and skillsets, which will in turn, result in new job roles and opportunities for professional development. This is evident by most organisations still expecting increased business activity (59 per cent) and headcounts (43 per cent) in 2020. Of all the Asian regions, Japan is expecting the highest increase in staff (52 per cent), as is evident by its tight labour market and falling unemployment numbers.
While the uncertain economic climate may have shook organisations, candidates seem as determined as ever in their search for greener working pastures. More candidates are actively looking for a new employer (36 per cent) as compared to last year (31 per cent), with their primary drivers for doing so remaining unchanged from the last four years; namely ‘salary or benefit packages’ (62 per cent), followed by ‘seeking new challenges’ (48 per cent) and ‘lack of career progression’ (45 per cent).
Their expectations for increments remain high as well. In the next 12 months, the majority of candidates across Asia expect increments of ‘between 3-10 per cent’ (24 per cent), followed by ‘greater than 10 per cent’ (22 per cent), and finally ‘1-3 per cent’, (21 per cent). While most employers expect increments to fall in the first two categories (35 per cent voted for each), only a mere four per cent are expecting to give out increments of ‘greater than 10 per cent’. This could indicate a possible mismatch in higher salary expectations moving forward.
“While 2019 was a challenging year for the region, Singapore has braved much of the economic fallout and maintained a healthy recruitment market,” said Grant Torrens, regional director at Hays Singapore. “However, as the results show, the impact of this will still be felt in 2020 as organisations become more cautious with hiring and compensation. Considering a significant amount of businesses are unsure they have the right skilled talent to reach their objectives, candidates can differentiate themselves and counter wage stagnation by upskilling in areas of high demand, as well as showcasing their adaptability to changing business needs. On the employer side, making provisions for better work culture and work/life balance could help retain top talent at a time when cost control is paramount.”