Salary increments likely to hold steady


Pedestrians on Orchard Road in Singapore, on Nov 20, 2023. Photographer: Lauryn Ishak/Bloomberg

SINGAPORE: Workers here can expect salary increments to come in around 4% in 2024, according to recent forecasts from talent firms.

Some companies are optimistic that real wage growth is within reach compared with the decline seen in 2023, given that inflation is expected to ease.

Consultancy firm Mercer projects that the aerospace sector is poised to experience the highest salary increase at 4.5%, followed closely by banking and finance, consumer goods and lifestyle retail at 4.4%.

Wage increases in the lifestyle retail and consumer goods sectors are predicted to pick up pace from 2023, added the firm, which collected data from 1,106 organisations across 18 industries in Singapore.

Conversely, the high-tech sector posted pay-rise projections of 4.1% while logistics industries reckoned 4%, lower than the figures they posted in 2023 and the 4.2% forecast across all industries for 2024.

Andrea Tan, rewards consulting leader at Mercer Singapore, chalked the consumer goods and lifestyle retail industries’ improvement down to their pursuit of technology and data-driven approaches for better customer experience and sales growth.

Companies in both sectors are competing for talent with data analytics and digital marketing expertise, she added.

“On the contrary, downsizing and lay-offs by high-tech companies, along with global supply chain disruptions and rising costs in the logistics industry, have led to a more cautious approach towards salary increments in 2024,” Tan noted.

Professional services firm Aon expects 4% salary growth in 2024, holding steady from 2023, according to data from over 600 local employers spanning eight industries, which was released on Nov 15.

The top three sectors for projected wage growth are retail and eCommerce at 5%, energy at 4.8% and tech at 4.7%.

The consulting and professional services, biotechnology and pharmaceutical, and gaming sectors are all trending below the overall figure.

Recruitment firm Persolkelly also released a salary guide, this one in conjunction with SkillsFuture Singapore.

It used wage data for roles in six job functions – like human resources – and six industries, of varying seniorities.

Foo See Yang, Persolkelly’s managing director and country head, told The Straits Times that workers in aviation and tourism-related sectors can expect larger wage increases in 2024, due to rising international travel and accelerated inbound tourism.

He added that the financial sector is expected to continue growing at a steady pace, with a rising demand for skilled finance talent in the sustainability space.

Conversely, Foo said sectors like retail that heavily rely on consumer activity could see wage stagnation or reduced growth due to economic uncertainty and decreased demand.

Likewise, declining demand for the manufacturing sector globally, amid export curbs, as well as trade and political tensions causing a contraction are anticipated to affect Singapore’s semiconductor industry, he said.

Recruitment firm Morgan McKinley found that new hires in 2024 can still stand to gain from larger increments than colleagues who joined earlier, but the breadth of roles and quantum of these increments are different from those in 2023.

“Despite the expectations of a hiring rebound, businesses are going to be more focused on salary corrections for their employees to hedge against inflation in an attempt to keep their existing head count stable,” it said of hiring in the technology sector in its salary guide for 2024 that was released on Nov 2.

The firm foresees a 15% to 20% pay jump for new hires in human resources in 2024, as companies gear up to support hiring activity in the year following a recruitment slowdown in 2023. It also forecasts a 15% increase for those changing jobs across all accounting and finance functions.

Recruitment firm Robert Walters expects large gains for human resources employees too. — The Straits Times/ANN

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