A REAL WAGE
Asian pay levels rising faster than anywhere else
By Don Durfee

Are you handing out larger raises these days? If so, you aren’t alone.

A new survey released by ECA International, a human resources association, finds that pay levels in Asia are rising faster than anywhere in the world. Overall, according to ECA, the inflation-adjusted pay raises handed out in the region will be 50% higher than last year. Indian workers will benefit the most, with real wage increases of 7%. Indonesia and China are close behind, with 6% salary rises, and the Philippines and Thailand expect 4% increases.

Driving this wage inflation, says Lee Quane of ECA, is a simple shortage of workers at a time when local economies are expanding. “In a number of Asian markets, economic growth is outpacing the skilled workforce, producing talent shortages,” he says. “As a result, many companies in the region are continuing to use hefty salary hikes partly to attract and retain top talents.”

Those salary hikes have been especially lavish at the senior management levels. In China, for instance, managerial pay has risen 50% since 2002.

Not all Asian countries see high wage inflation. In Hong Kong, pay is forecast to inch up just 1.5% this year, and in Japan, Taiwan, South Korea and Malaysia, wages will likely rise between 2% and 3.5%. In Singapore, salaries will rise 2.8%.

Still, workers in those countries are doing better than their counterparts overseas: US workers will have to get by on a meager 1.1% raise this year.