Salaries Expected To Recover To Pre-COVID-19 Pandemic Levels In Southeast Asia In 2022, Aon Study Reveals – Techspace Africa

  • Salary increases in 2021 were lower than in 2020; bonus payments fell approximately 25 percent.
  • Some industries, such as private banking, saw steady increases in wages, while retail and professional services faced challenges.

SINGAPORE – Media reach – December 15, 2021The The COVID-19 pandemic has weighed heavily on talent strategies with moderate pay increases across Southeast Asia, according to a study by Aon plc (NYSE: AON), a leading global professional services company. The second edition of Aon’s 2021 Salary Increase and Turnover Study It was carried out from June 2020 to June 2021, and analyzed the salary movements and turnover rates of more than 870 companies in Singapore, Malaysia, Thailand, Indonesia and Vietnam.

Companies must prepare for potential talent risks in 2022 after a quiet 2021

In Singapore, wage increases across all industries fell to 3.3 percent in 2021 from 3.8 percent in 2020. Similar trends were seen in Malaysia and Thailand, with 2021 wage increases of approximately 4.5 percent and 4.4 percent, compared to 4.7 percent and 4.9 percent in 2020, respectively. Bonus payments, which were relatively isolated in 2020, calculated for the previous performance year, also fell 20 to 25 percent in 2021 across Southeast Asia.

However, as organizations adapt to new and agile workforce models, compensation policies are expected to normalize to pre-pandemic levels in 2022. The study showed that salary increases are forecast for Singapore, Malaysia and Thailand they will recover to 3.8 percent, 4.9 percent and 4.9 percent. percent, respectively, in the next year.

Voluntary turnover in 2021 remained virtually flat or decreased, as reported in Singapore (from 11.3 percent in 2020 to 10.8 percent in 2021) and Malaysia (from 10.6 percent in 2020 to 8.7 percent in 2021), showing that there are doubts about changing employers amid an uncertain business landscape.

However, like Southeast Asia the economy is ready to recover, Aon expects billing to increase after the current recession.

Rahul Chawla, Managing Director, Human Capital Solutions, Aon, Southeast Asia, said: “Organizations must prepare and have the right strategies for global talent trends like ‘The Great Resignation’. This will be further complicated by other factors introduced by the pandemic, such as new work models and an increased demand for digital skills. However, these extraordinary times also present opportunities for companies to stay at the forefront in the war for talent as they continue to build a resilient workforce. We expect to see an increase in hiring and turnover activity soon, so rethinking compensation and benefits strategies will be a critical success factor in preparing for next year. “

Retail, hospitality and professional services continue to face headwinds

The study also revealed how the pandemic affected individual sectors. In financial services, the consumer banking industry posted minimal wage increases due to prevailing macroeconomic conditions and the commercial performance of banks. However, private banking experienced continued wage growth thanks to continued wealth creation in the region and the need for sophisticated financial planning. Similarly, the life sciences and medical device industries posted wage increases in Singapore, Malaysia, and Thailand of 3.6 percent, 4.6 percent, and 5.0 percent, respectively. By contrast, retail, hospitality and professional services continue to face headwinds; for example, the Singapore market saw a salary increase of just 3.0 percent in the consulting and professional services industry.

To address some of these challenges, data from Aon shows that organizations have invested in different talent and skill pools. For example, in response to the growing importance of digital solutions in new work models and the need to address the increased risk to employee health and well-being, IT and HR salaries in certain economies like Thailand showed the strongest recovery, with salaries for junior employees increasing by as much as 20 percent.

Average salary increase in 2020 and 2021

Country / Territory

Salary Increase 2020

2021 salary increase

Singapore

3.8%

3.3%

Malaysia

4.7%

4.5%

Thailand

4.9%

4.4%

Indonesia

7.5%

6.5%

Vietnam

8.5%

7.5%

Average voluntary turnover in 2020 and 2021


“The trends observed for 2021 reflect the phases of reaction, recovery and remodeling that most companies have experienced in the last 18 months. With higher vaccination rates across Southeast Asia and the resumption of travel, the expectation in 2022 is a long-awaited recovery where we will see more movements in the talent market. As they continue to fight the war for talent, organizations can leverage this data and insights to make better and more informed decisions as they build roadmaps to deliver improved value for employees in the future, ”said Chawla.

To view the study, click here.

About the study

Aon’s Salary Increase and Turnover Study provides clients with useful information to ensure their pay cycles are aligned with general market trends. Conducted twice a year, the study covers more than 130 countries / territories and 4,100 companies worldwide.

The salary increase and turnover study covers the following key market practices:

  • Actual and Merit-Based Total Salary Raises
  • General and Merit-Based Budgeted Salary Raises
  • Expected Trends in Hiring and Workforce Growth
  • Key Talent Identification and Reward Differentiation Practices
  • Performance management practices
  • Promotion practices
  • Trends in the movement of the wage structure
  • Voluntary and involuntary turnover rates

About Aon

Aon plc (NYSE: AON) exists to improve decisions, to protect and enrich the lives of people around the world. Our colleagues provide our clients in more than 120 countries with advice and solutions that give them the clarity and confidence to make better decisions to protect and grow their business.

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