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According to the latest Salary Trends survey by ECA International, employees based in Malaysia are forecast to see real wage increases of 2% in 2017. This is down on the 3.1% in 2016 due to rising inflation.
“Low unemployment continues to exert upward pressure on wages in Malaysia and this is reflected in the 5% nominal salary increases forecast next year,” said Lee Quane, regional director – Asia, ECA International. Lee added that due to labour costs being higher in Malaysia than some of its competitors, investments are lost, especially to other ASEAN member economies.
“As is the case with Singapore, the regional economic slowdown is contributing to rising inflation, which is why employees based here will be worse off next year than in 2016,” added Lee.
Employees in Singapore should also see a similar forecast, with real wage increases by 2.9% above inflation on average. The survey reported that despite offering 4% nominal salary increases in both 2016 and 2017, rising inflation means staff in Singapore will see a decline in real wage increases next year.
The report added that Singaporeans will not likely be able to enjoy the 4.3% average real wage increase in 2016 due to the transition of 0.3% deflation in 2016 to 1.1% inflation in 2017.
Asia Pacific regional rankings for nominal & real wage increases (with global rankings):
As for other regions, Hongkongers will see their salaries increase by an average of 4% again in 2017. With inflation predicted to be 2.6% in 2017, employees will experience the third lowest wage increase in Asia Pacific, estimated to be a 1.4% increase in real terms. In fact, employees based in Macau are forecast real wage increases of 1.7% in 2017, overtaking Hong Kong in the regional rankings.
Regionally, the survey reported real wage increases in Asia Pacific are expected to be 2.6% next year on average. This is higher than all other regions surveyed. In terms of real salary increases, staff in Vietnam will experience the highest regional and second highest global real wage increase next year at 5.4%.
On the other hand, staff based in Myanmar can expect to be 1.6% worse off in 2017. Despite being forecast nominal salary increases of 7.5%, inflation forecast at 9.1% translates to them being the only location in the Asia Pacific region to see staff worse off next year.
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