HR Asia — January 2018

A

ccording to the latest Salary Trends survey by ECA
International (ECA), Singaporeans will see their salaries
increase by 4 per cent in 2018.
After factoring in infl ation, predicted to be 1.
per cent next year, employees are expected to see a real
salary increase of 2.7 percent in 2018. This keeps Singapore
near the middle of the salary increase table in Asia, ahead
of Hong Kong once again, ranking ninth out of 20 countries
surveyed in the region.
ECA International Regional Director-Asia Lee Quane said,
³Over the past few years infl ation in Singapore has increased while
nominal salary increases have stayed fl at, which has had the effect
of slowly eroding pay rises in real terms.
“Despite this, the salary increases for 2017 and 2018 are
higher than in Hong Kong and compare favourably with other
developed economies in the region and globally. This refl ects the
fact that the Singapore economy continues to perform well on the
back of global economic recovery.”
In Malaysia, low unemployment and a strong economy have
kept wage increases above 5 per cent for several years and this
will continue in 2018. Employees look set for a boost in real salary
increases as infl ation is forecast to fall back slightly.
ECA is the world’s leading provider of information, software
and expertise for the management and assignment of employees
around the world. ECA’s Salary Trends Reports analyse current
and projected salary increases for local employees in 72 countries
across the world.

MAINLAND CHINA AND SPECIAL
ADMINISTRATIVE REGIONS Despite slower economic
growth recently, companies in mainland China are expected to
provide staff with an average salary increase of 6 per cent next
year. Relatively low infl ation will mean that mainland China will
once again be among the ten countries with the highest real rates
of increase in 2018.
“A forecast average rate of increase in China of 6 per cent
is higher than the 5.5 per cent awarded on average in 2017,”
continued Quane. “This points to improved business sentiment in
China, which perhaps shows that employers are more positive for
the prospects of both the domestic and global economy in 2018.”
Hong Kongers are expected to see a real salary increase of
1.8 per cent in 2018, keeping Hong Kong near the bottom of the
real salary increase table in Asia, ranking 16th out of 20 countries
surveyed in the region.

ASIA-PACIFIC HIGHLIGHTS Asia-Pacifi c countries
continue to outperform the rest of the world, occupying eight of the
top ten spots in the global rankings with all locations expecting to
receive above-infl ation salary increases.
India is expected to keep the regional top spot in 2018, with
a real rate increase of 4.9 per cent predicted. India will be joined
within the global top ten in terms of real salary increases by fellow
sub-continent nations – Pakistan and Bangladesh along with
ASEAN countries – Vietnam, Indonesia, Thailand and Cambodia,
as well as China.
Employees in Japan will receive the lowest rate of increase
in 2018 with companies forecasting salaries to increase by 2.2
per cent in nominal terms. However, in real terms, Australians

STEADY REAL

SALARY INCREASES

IN APAC COUNTRIES

FORECASTED

By ECA International

Note: The real salary increase is calculated based on the difference between

the forecast nominal salary increase and infl ation. Forecast infl ation rates are

based on information from the International Monetary Fund.

will see the lowest increase in their earnings in 2018, with real

wages expected to rise by only 0.8 per cent.

Source: ECA International

GLOBAL MARKETS Although there is improved growth in

some major European economies, expected real salary increases

remain low. Real wage growth in Germany and France is expected

to be 1.2 per cent and 0.9 per cent respectively. The UK will see

the lowest rate of real wage growth in the region, with incomes

expected to increase by 0.2 per cent in real terms. Russia is

forecast to move to the top of the European rankings in 2018. As its

economy stabilises and infl ation falls, employees in Russia are set

to receive a .1 per cent real salary increase ne[t year.

The global top spot for real salary increases is taken by

Argentina, which is forecast to receive an impressive 7.2 per cent

real salary increase in 2018.

Quane added, “President Macri’s market-friendly policies are

e[pected to bear fruit in Argentina ne[t year, causing infl ation to

cool and bringing respite to hard-pressed workers after years of low

or negative real salary increases.

“As a result, Argentina has jumped 22 places in the 2018

global rankings, topping the chart for the highest real salary

increase in the world.”

In the Americas, average real salary increases are predicted

to be 1.6 per cent. Employees in Mexico in particular look set to

benefi t from lower infl ation in 2018 to record a real-terms increase

of 0.8 per cent. Uplifts for the US and Canada are set to remain

steady, at 0.9 and 1.1 per cent respectively.

Despite both expecting to see 10 per cent nominal salary

increases ne[t year, Egypt and 1igeria fi nd themselves at the

bottom of the global rankings thanks to high infl ation. This will likely

far outweigh pay rises and cause real decreases of 11.2 and 4.8

per cent respectively.

/ower infl ation in *hana will help the country to leap 1 places

globally and top the regional rankings for Africa and Middle East,

with employees predicted to enjoy a 4.7 per cent real pay hike.

The imminent introduction of VAT in the countries of the Gulf

Cooperation Council has raised infl ation forecasts. Saudi Arabia and

Qatar are particularly affected with both anticipated to experience

real salary decreases as a result, dropping from among the highest

ranked nations in the region in 2017 to the lowest in 2018.