Will Next Year's Salary Increase Be Enough to Beat Inflation?
Filipino employees can expect a salary increase of around six percent in 2019, according to global consultancy firm Mercer.
The outlook is based on responses from over 400 Philippine-based companies in Mercer’s “Compensation Planning for 2019” study, which reports on market trends in hiring, employment and resignation across Asia and Africa. Employees in Bangladesh can expect the highest pay increase next year at 10 percent, while Japanese workers will see the lowest hikes at only two percent.
However, the figure is also equal to the latest reported inflation rate, or the measure of how fast consumer prices rise, which was pegged at six percent last November. While that is expected to ease in 2019, it could mean that the increase in employee pay may be offset by more expensive consumer goods.
Despite this, the Mercer study said that the outlook for employment in the Philippines is mostly optimistic, saying that half of the surveyed companies expect to hire new talent for next year. That figure rises for the shared services and outsourcing industry, where 70 percent of companies are expanding their workforce.
“The overall hiring outlook for the country is positive, with an average of 50 percent of companies across different industries looking to grow their talent pool to seize diversification and growth opportunities in the face of ongoing digital disruption,” said Floriza Molon, Mercer’s career business leader for the Philippines, in a statement.
The study also revealed that many employers are looking to offer higher salaries to employees with relevant skills for today’s digital economy. It highlighted data analysis and specialist sales roles as skills where companies can “offer a significant premium.”
“Asia, especially in markets with young populations like the Philippines, continues to see sustained demand for skilled talent, with digital skills continuing to draw a premium,” added Molon.
On the other hand, the study also said that Filipino workers usually only stay with their employers for five years before moving to another job. That figure is even less for the shared services and outsourcing industry, where employees only stay for three years on average.
"Employees cite a lack of career path and opportunity to grow, low pay competitiveness, and unpleasant relationships with supervisors as their top reasons for leaving their current organization," wrote Mercer.