Good News: 5.6% Average Salary Increase Projected for Filipino Workers This Year
Employers in the Philippines are projected to give pay rises this year at an average of 5.6 percent, reflecting the overall optimism despite no clear end to the scourge of the pandemic. In addition, as much as 82.4 percent of companies in the country will implement salary increases.
According to the Salary Budget Planning Survey report of Willis Towers Watson, a global advisory, broking and solutions company, this year’s average pay hike is a slight increase from the 5.5 percent in 2020, which itself was a drop from 2019’s 6.0 percent of actual salary increase. That was the lowest average salary increase for the Philippines in more than a decade. In Asia Pacific, companies in 13 out of the 20 markets have also decreased their 2021 average salary increase forecasts.
In Asia Pacific, the Philippines is right in the middle of projected salary increases per country. Employers in Japan project the lowest pay hike at 2.2 percent, while Bangladesh and India are projecting the highest increaes at eight percent and 7.9 percent, respectively.
Fewer companies—about 13 percent—will announce salary freezes this year, compared to 28 percent last year, the report added. About 82.4 percent of companies are expecting to conduct a salary review in 2021, versus 61 percent in 2020.
The pay hike is most likely in more optimistic industries, reflecting their differing fortunes during the pandemic. The most optimistic industries are Pharmaceutical and Health Sciences, High Tech, Electronics Manufacturing and Business Support Services, including Business Process Outsourcing, with a 2021 salary budget increase forecast of five percent or more. According to the report, these industries will continue to see an increase in demand for talent as employers in these sectors prepare for growth and development opportunities in 2021.
“After a difficult year for employers and employees—battling lockdowns, employee safety issues, working from home and declining revenues—many employers are finding ways to handle the crisis better, manage their businesses and help their employees with a more focused work and reward strategy,” said Patrick Marquina, Head of Talent and Rewards, Philippines, at WTW.
“While there is certainly more optimism this year in both employers and employees alike, the recovery for many hard-impacted businesses would not be smooth sailing,” he added. “Companies will continue to experience smaller salary budgets this year. Therefore, it is important for employers to differentiate their allocation of pay rises, so that they can provide meaningful salary increases for their best and most valuable talent, and prioritize spending on jobs that are likely to contribute the most to the success or survival of their businesses”, added Patrick.
WTW’s Salary Budget Planning Report is based on a survey conducted online in October and November 2020. The surveyed covered over 18,000 sets of responses in over 130 countries worldwide. In the Philippines, a total of 233 companies participated across different industries.