This Year, You Can Expect 5% Pay Raise or 3.6% Increase in Real Wages

Malaysians could see a 5% pay raise coming their way this year, slightly lower from 6% in 2018.

Meanwhile, real wages are expected to grow by 3.6% in 2019, according to the Korn Ferry 2019 Salary Forecast. This is a slight increase from 3.5% predicted last year, adjusted for an inflation rate of 1.4%.

The forecast released on 17th January 2019 said all sectors surveyed are expected to see an increase in median base salaries. Media and telecommunications sector are predicted to see the highest increase in 2019, with a 0.4% increase to 6.0%.

Salary Increases around the world. Click on the image for larger size. Source: Korn Ferry

The Forecast predicted that the insurance and oil and gas sectors to see the smallest increase in median base salaries, with only 0.4% up from 5.4% and 4.2% respectively. It also said that the industrial products sector is the only exception as median base salaries are predicted to decrease by 0.2% to 4.9%.

Country manager of products Halim Ariff said Korn Ferry has observed that many organisations are taking a ‘wait and see’ approach. He said that organisations are being cautious in allocating bigger amounts of increments to their employees because of the economic contractions signs.

Halim said variable bonus payment trends are also expected to decrease, averaging 2.1 months in 2019 as compared to an average 2.3 months in 2018. “Bonuses for the construction sector are expected to be amongst the highest in 2019 at 2.8 months, while bonuses for employees in the consumer goods and services sector is expected to remain amongst the lowest at 1.9 months,” he said.

Global Salary Increases. Click on the image for larger size. Source: Korn Ferry

On average, senior and middle management are expected to see the largest drop in variable bonus payments, down 0.6 month and 0.5 month respectively, while clerical staff are expected to see an increase of 0.2 months. Bonus of junior professionals are likely to remain at an average of 2.0 months in 2019.

Halim added that with the low growth optimism, Korn Ferry would recommend that companies review remuneration cost drivers so that it is consistent with the changing market conditions and business environment.

Real Salary Increases. Click on the image for larger size. Source: Korn Ferry

The data was drawn from Korn Ferry’s pay database of more than 20 million job holders in 25,000 organisations across more than 110 countries. It shows projected salary increases for 2019, and compares them to predictions made at this time last year, regarding 2018. The data also compares them to 2019 inflation forecasts from the Economist Intelligence Unit.

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