The latest Salary Trends survey by ECA International (ECA) predicts Hong Kong workers in the private sector will see their salaries increase by four per cent in 2019 for the fourth year in a row. However, after inflation, predicted to be 2.1 per cent next year, employees are expected to see a real salary increase of 1.9 per cent in 2019. This keeps Hong Kong near the bottom of the table for real salary increases in the APAC region, ranking 15th out of 20 countries surveyed in the region.
Lee Quane, regional director – Asia at ECA International, said: “Salaries will increase at a rate of 4 per cent in Hong Kong next year, which is in line with last year and comparable to similar economies in the region. Once expected inflation is taken into consideration, real incomes will increase at a rate of 1.9 per cent, which is higher than the 1.7 per cent rate of increase in real incomes witnessed in 2018. While the forecast rate of increase in salaries in Hong Kong is lower than the average for the Asia-pacific region, it compares favourably to other advanced APAC economies such as Australia and Japan. This is because as one of the most well-established economies in the region, salaries in Hong Kong are already substantially higher than most in the region and therefore do not increase as dramatically as many of the emerging Asian economies that are above them in the survey.”
ECA International’s annual Salary Trends Report analyses current and projected salary increases for local employees in 69 countries across the world.
Asian nations once again dominate the global top twenty highest real wage increases. 14 of the top 20, and all but one of the top ten, are Asian countries.
Quane said: “The average real salary increase in the APAC region is predicted to be 2.7 per cent in 2019 – over double the global average of 1.2 per cent. Low inflation and rising productivity mean that many Asian economies, and therefore local salaries, are growing rapidly.”
India tops the rankings for 2019, where employees are forecast to receive a 5.1 per cent real salary increase, over double the rate of increase employees in Hong Kong will experience. Similarly, workers in other Asian countries with rapidly growing economies, such as Vietnam and Thailand, will see major increases to their average salary too and join India towards the top of the global rankings.
Elsewhere in Asia, Singapore performed similarly to Hong Kong. Singaporeans will receive an average real salary increase of 2.6 per cent in 2019, ranking 11th out of the 20 APAC countries surveyed. This is higher than the real rate of increase that Hong Kong workers will receive in 2019 but lower than the 2.9 per cent real increases that workers in Singapore saw in 2018.
Quane said “Workers in Singapore are expected to receive a nominal salary increase of 3.9 per cent – slightly lower than their counterparts in Hong Kong. However, due to a lower level of inflation expected in Singapore in 2019, the real salary increase will be 0.7 per cent higher than Hong Kong at 2.6 per cent.”
In greater China, mainland China will lead the way with real salaries increasing at the fastest rate in 2019, followed by Taiwan. Meanwhile, Hong Kongers will be able to take some solace in the fact that in real terms, salaries of employees in Macau will increase at the slowest rate in the greater China region.
Quane added “Workers in mainland China are set to continue to see their salaries increase at the fastest rate in the greater China region, both in nominal terms and real terms with the pay of workers based in Shenzhen likely to increase at the fastest rate. Furthermore, employers in mainland China seem to be more positive on the economic outlook with companies forecasting an increase in salaries in nominal terms of 6.5 per cent in 2019 versus 6.0 per cent in 2018. This compares favourably to the rest of the APAC region where the overall average nominal salary increase is set to remain at 5.5 per cent – the same as it did in 2018.”
