Overall salary budgets in Singapore are projected to rise by 4.4% in 2016 according to a new study by Towers Watson. This is well below 6.8% – the predicted increase in salary across APAC.
The
2015 Asia Pacific Salary Budget Planning Report looks at the likely pay rises throughout the region and encourages employers to remain vigilant when choosing future salary levels.
“Determining current pay rates for jobs in Asia Pacific’s highly competitive talent market is akin to shooting at a moving target,” said Sambhav Rakyan, data services practice leader for Asia-Pacific at Towers Watson. “What companies pay for a job today might be different tomorrow, and if managers don’t keep an eye on the market, they could risk losing valuable talent to the competition.”
With inflation in Singapore projected to be 1.5% in 2016, Towers Watson predicts an adjusted salary increase of 1.5% for local businesses. Again, this is far below the average real wage growth of 3.4% in the Asia-Pacific.
While these estimated pay rises are muted, there is still room for businesses to move when retaining new candidates.
“Facing the challenge of rising inflation and cost, employers are taking a more strategic approach to retaining talent such as by offering an employee value proposition that’s more creative and flexible – for example, benefits options to which employees can more readily relate and appreciate,” said Rakyan.
Supporting this, a recent
Hays study found 63% of Singaporeans were willing to take a pay cut if they could earn more through performance-based bonuses.
“Skilled professionals in Singapore are very confident in their own capabilities and their capacity to achieve high results,” said
Christine Wright, managing director of Hays in Asia.
Noting there was no one-size-fits-all approach to compensation packages, Wright advised employers to “work with a candidate and their recruiter to tailor an offer that has the best chance of retaining them long-term”.
When writing up these creative agreements, it is important for HR to carefully draft the contract to minimise chances of disputes later on, said Seow Hui Goh, partner at Bird & Bird Singapore.
“[You] don’t want the employee to come under the impression that he or she is entitled to something more than what was intended,” she told
HRD. “Sometimes it’s a drafting issue.”
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