Employees' unmet expectations driving them to consider other employers
Most employers across Singapore have reported an increase in staff turnover and disengagement after they reduced or postponed pay rises, according to a new report.
Findings from a new Robert Walters survey revealed that 45% of employers in Singapore reduced or postponed pay rises, while 17% did not give one at all this year.
These actions have led to an increase in employee turnover or disengagement in the workplace, according to 93% of the employers surveyed.
In fact, 72% of employees surveyed said they are now actively looking for a new job after not getting a pay rise this year.
Financial constraints for firms
This challenge for employers comes in the wake of financial constraints for businesses.
According to the poll, 34% of business leaders surveyed said business performance was the top reason for delaying or reducing pay rises.
This is followed by budget constraints (23%) and then market uncertainty (23%).
Kirsty Poltock, Country Manager at Robert Walters Singapore, said while employers' actions are understandable, they still come with consequences.
"There's a clear message here: even if employees understand the business pressures, unmet expectations are still pushing them to reconsider their options," Poltock said in a statement.
"And with AI tools streamlining the job application process, employees have more opportunities than ever to explore new roles."
What can employers do?
Poltock underscored the importance of salary benchmarking and market insights in these situations.
"Professionals who have not seen a pay rise may show signs of disengagement or raise their expectations in their next review, and employers will need market data to communicate credibly, demonstrate fairness, and manage expectations," she said.
She added that employers should consider focusing on culture and communication, as well as be creative about what they can offer, when pay increases aren't feasible.
"I would advise employers to think creatively about what they can offer beyond pay, to consider perks such as meaningful career development, flexible working arrangements, and internal mobility pathways," she said.
"When salaries are constrained, culture and communication matter more than ever. The organisations that succeed will be those that balance cost control with a thoughtful, market-informed approach to employee engagement."
