A forecast issued by Korn Ferry reveals that while 2020 salary increases across the globe are expected to grow at about the same rate as 2019, slowing inflation will mean an increase in real-wage salary growth.
In Asia, salaries are forecast to grow by 5.3 percent in 2020. With an inflation rate of 2.2 percent, real-wage salaries are expected to be 3.1 percent, the highest growth rate compared to other regions.
In Singapore, real-wage salaries are estimated to increase by 3.6 percent, up from 3.0 percent last year. While the headline forecast for 2020 remains at four percent, similar to last year’s forecast, a benign inflation rate of 0.4 percent contributes to the higher real-wage increase.
China’s real-wage forecasted growth for 2020 weakened to 2.9 percent, down from 3.2 percent in 2019 and 4.2 percent in 2018. Japan saw a real-wage prediction of 0.6 percent, up from last year’s prediction of 0.1 percent. In the meantime, political uncertainty in Hong Kong and a relatively high inflation rate of 2.6 percent has translated to a modest real-wage growth forecast of 1.4 percent in 2020.
“With the ongoing situation in Hong Kong and geopolitical uncertainty in other parts of Asia, International and MNCs might re-ignite conversations around choosing Singapore as the main location for ASEAN and APAC Head Offices. This will keep continuous pressure on wage increases for Singapore market, more than anticipated because of economic slowdown and the US-China trade war. We see this pressure building up for the middle to senior-level managers, more than junior and entry-level graduates,” said Kartikey Singh, Head of Rewards & Benefits, Korn Ferry Singapore.