Recruitment and HR firms noted that they are the least confident when it comes to negotiating for a higher pay.
A recent report by Randstad revealed that workers in Singapore (63.9%) are least optimistic about pay rise, as compared to those in Malaysia (78.1%) and Hong Kong (71.2%).
Human resource consultancy and recruitment firms noted employees' awareness of their company and industry's stability affect the worker’s optimism on pay rises.
“Companies are likely to take a cautious approach and are waiting for the market to stabilise before committing to increasing employees' salaries and this is something that majority of the Singaporean employees are aware of, which explains their conservatism on pay rise,” said Jay Dass, managing director of Randstad Singapore.
“A percentage of this trend is due to the fact that certain sectors aren’t performing as well as they used to in the past, such as some financial services sectors as well as oil and gas in Singapore. Therefore Singaporeans are comparatively more realistic in their expectations these days,” added Nilay Khandelwal, regional director of Michael Page Singapore.
Case in point, BMI Research forecasted the growth in the local energy and utilities infrastructure sector is seen to slow down over the next 10 years as the surge for power construction projects end this year.
Besides being the least optimistic about pay rise, the report highlighted that Singaporean workers are also the least confident when it comes to negotiating for a higher pay.
Matthieu Imbert-Bouchard, managing director of Robert Half, noted the current market fragility brought about by slow growth in the Gross Domestic Product (GDP) affect the way employees negotiate for a pay rise. “I guess a lot of employees are very cautious when they negotiate salary because the market is just a bit more fragile in Singapore at this time.”
Singapore’s economy increased by 3.6% in 2017. The Ministry of Trade and Industry (MTI) expects it to slow down this year thus setting GDP growth forecast at merely 1.5-3.5%.
Moreover, improving skillsets is an important step to help employees gain the confidence they need to negotiate for a pay rise.
“Singapore is moving into a period of rapid digital transformation and innovative technologies, revealing the skills gap between what companies are seeking for to expand and the skills that employees currently possess. In order to instil the confidence to negotiate for a pay rise, it is essential that employees receive adequate training programmes and craft their job scope to align with the overall business objectives,” Dass explained.
Another report by recruitment firm Hays noted that whilst 49% of employers plan to increase salary by only 3-6% this year they are also willing to pay higher for talents with niche skills.
“Our Guide shows that most companies in Singapore are taking a conservative approach to salary increases for the most part, but are more than willing to go well above the average when hiring those with niche skills and in areas of skill shortage,” said Lynne Roeder, managing director of Hays in Singapore, in a press release.
“For example, specialised roles in some areas of sales, IT and accountancy & finance are experiencing skill shortages and thus commanding substantial salary increases,” she added.
In line with this, Roeder advised candidates “to do their homework on what their job role and industry is paying before deciding to move job roles in search of a higher salary”.
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