Salaries in Malaysia rose by 5.1 per cent in 2019 and are expected to jump by 5.3 per cent in 2020, according to the Malaysia 2019 Salary Increase & Total Compensation Measurement Survey by Aon plc. The rates indicate that wages in Malaysia are increasing faster than those in Singapore (3.8 per cent) and Thailand (4.9 per cent) but slower than in Indonesia (7.4 per cent).
Aon’s Rewards Solutions, Malaysia director & head, Rahul Chawla said the rewards landscape in Malaysia was very active in 2019. “A volatile macroeconomic and geopolitical environment coupled with a pressing need to deliver efficiencies compelled businesses to revamp their rewards programmes. “In the last 12 months, organisations have implemented incentive plans aimed at catalysing transformation and delivering shareholder value. Value creation for all stakeholders and value sharing amongst key contributors seems to be the mantra for the coming year,” he said.
With annual inflation at 2.4 per cent, Malaysians experienced an average growth of 2.7 per cent in real wages in 2019, up from 2.1 per cent the previous year. In the face of a growing economy and steady salary increases, Malaysian businesses must evaluate their compensation packages, to ensure they can continue to attract and retain their most critical talent.
According to the survey, median pay for jobs in engineering and technology are relatively higher than all other job roles across the Malaysia market. Those working in engineering roles earn, on average, 14 per cent higher and those in technology such as cyber security and information technology, earn 12 per cent more than other job functions within the Malaysia market as a whole. Fresh engineering and high-tech graduates enjoyed a 16 per cent higher starting median salary compared to fresh graduates in other functions. With digital and technological advancements, employers are paying a premium for talent in these areas. The survey further revealed that median pay for software engineers/application developers increased by 17 per cent from the previous year across various levels of seniority, demonstrating the continuing commitment of Malaysian employers to prepare for Industry 4.0.
Across all industries, senior legal managers earned 20 per cent more than the market average, whereas compensation for senior business development managers/strategic planners was 22 per cent higher than the market average, illustrating the premium employers place on professionals with specialist skill sets.
The Malaysia 2019 Salary Increase & Total Compensation Measurement Survey is Aon’s nationwide measure on how organisations are addressing projected salary budgets, variable pay, cost-saving initiatives, and more. It contains data on key changes in employee compensation in 2019 and projections for 2020. Data was collected from 320 employers across Malaysia. Aon’s 50,000 colleagues in 120 countries empower results for clients by using proprietary data and analytics to deliver insights that reduce volatility and improve performance.