SINGAPORE: Businesses around the world have struggled over the past year to adapt to the impact of COVID-19.
In no time, companies have had to switch to flexible working arrangements and accelerate digital transformations to keep their businesses afloat.
Many companies have also had to downsize and cut or freeze wages along the way.
As economies gradually open up and countries roll out their immunization programs, the tide seems to be reversing and experts expect better recruitment and salary prospects for Singapore and the region – especially for some. industries such as technology.
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According to consulting firm Willis Towers Watson, around 30 percent of private businesses in the area froze wages last year to cut costs amid lockdowns and declining revenues. In 2021, only around 13% expect to receive a free salary.
In a sign of optimism, 85% of global companies polled by the company said they intend to raise wages this year.
For developing countries, the wage increase could average 6.2 percent, while in advanced economies, workers could see their wages increase by around 2.5 percent.
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In the Asia-Pacific region, the expected average wage increase is 5.3%, slightly less than the revised increase of 5.4% in 2020 and the increase of 5.6% in 2019.
Ms. Vidisha Mehta of Willis Towers Watson said the general atmosphere is one of cautious optimism and many organizations are taking a wait-and-see approach.
For Singapore, an average increase of 3.5% is expected in 2021, less than the two previous years.
Ms Mehta, head of talent and rewards at Willis Towers Watson, said the average reflects the differences between sectors and how they have been affected by the pandemic.
“High tech as an industry continues to do well. We also see that the pharmaceutical and healthcare industries are doing well and are forecasting relatively higher increases. There are, of course, industries that have been adversely affected by the pandemic. And a lot of those were in the travel industry or physical retail. And so there might be a bit of conservatism in these industries, ”she said.
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According to a survey by recruiting firm Michael Page Singapore, the annual salary could increase by 3.5% in the tech sector and 2.8% in health care and life sciences.
Wage increases in the retail, real estate and construction sectors are expected to be just above zero.
“The spirit is really to save jobs, as many jobs as possible,” said Mr. Nilay Khandelwal, Managing Director of Michael Page Singapore.
If your industry or area of expertise does not allow it, you have to be very honest and you cannot raise the salary. The idea is to make sure that you reward people based on the performance at that time, ”he added.
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Consulting firm Mercer said economic uncertainties are pushing employers in the region to be more cautious. However, there is also the risk that when the economy begins to recover, companies that freeze wages risk losing good talent, she warned.
In a study on rewards trends, Mercer found that the top priorities for employers for 2021 are to manage costs while delivering competitive compensation and benefits at the same time.
Employers are also looking to align incentives with company goals by trying to improve the digital workplace and deliver targeted value and compensation to employees.
Godelieve van Dooren, CEO of Mercer in Asia, said: “We have talent transformers emerging. It’s about re-qualifying people. How to reinvent our way of working? What about hybrid work and how do we collaborate? We can really provide a positive experience for employers and managers, and the pay should incentivize that. “
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As workplaces change, experts have said some jobs will require higher wages due to supply and demand.
Michael Page Singapore’s Mr. Khandelwal said tech professionals can expect to receive the biggest pay increases.
“In Singapore alone, the average increase is between 15 and 20%. Under normal market conditions it was probably 10 or 15 percent. So he took over. And I think the demand is significantly higher than the supply. “
More companies in Singapore are now planning to increase their workforce after recruiting activities fell by 35% last year, Page said.
Besides technology, jobs in high demand also include sales and marketing, finance and accounting, logistics and supply chain, and human resources.
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While compensation remains key to attracting talent, some experts have also observed a shift in the way workers perceive compensation.
This includes the financial stability of the organization, ease of career progression, as well as mental health support for employees.
HR expects that with the growing awareness of these issues, companies that are able to articulate these qualities in their employee value proposition will be in a better position to attract and retain talent.