The new year looks set to be better than the last
Here’s some good news for the new year: staff in Singapore can expect to see higher salary increases in 2022. On average, ECA International found that staff will see an average pay hike of 3.5%. This is up from 2.8% the year before. ECA has also forecasted that just 6% of companies based in Singapore will continue to implement a pay freeze in 2022. This is significantly lower than this year, with 22% putting a pay freeze as businesses work hard to recover from the heavy financial impact of the past two years.
“Workers in Singapore are set to see a notably higher increase to their salaries than in previous years, with the predicted 3.5% rise up from 2.8% this year and 2.5% in 2020,” said Lee Quane, regional director – Asia at ECA International. “This all points to a much-improved outlook for workers in Singapore as the economy gradually recovers from COVI-related restrictions and uncertainty.”
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As in previous years, the Asia Pacific region is expected to lead the way once again in terms of salary increases – almost double that of other regions. Workers in China are predicted to see the second biggest salary increase in the region next year in real terms at 4.0%, only surpassed by Vietnam.
Southeast Asian nations will be amongst those countries expected to see the fastest rate of salary increase in 2022 versus 2021 as their economies recover. This includes Indonesia, Vietnam, Thailand and Malaysia as their economies begin to recover from the effects of the Covid-19 pandemic and international travel resumes.
Workers in Hong Kong will see their salaries increase at a faster rate in 2022 than in 2021, although not as fast as many other Asian nations. Salaries are set to rise by 3.2% on average in 2022 and after factoring in the forecasted 2.1% inflation for next year, this means workers in Hong Kong will be left seeing a real salary increase of 1.1% – almost double the real salary increase of 0.6% that was seen this year.
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Unfortunately, employees elsewhere may not be enjoying a similar financial boost in the new year. Despite the prediction that employees globally will enjoy an average 4.6% pay hike, the higher levels of inflation outside of Asia may do little to ease any pandemic-related financial stress.
“Despite many Asian nations expecting to see improved consumer buying power with real salaries increases both this year and next, the same unfortunately cannot be said for every country as supply chain issues and rising gas prices have fuelled inflation while the effects of the pandemic continue to take their toll on salary increases for many,” Quane said. “This trend looks set to continue for workers in many locations who will see decreases to their salaries in real terms next year, as inflation outstrips any nominal increase. This is even the case for a major economy such as the US where workers will see a 0.5% decrease in real terms.”
