HCS/RDS 2015/2016 Survey on Business Prospects/Wage Increase/Bonus & Work Stress.
HCS and RDS surveyed 90 companies in December 2015 to find out about their business prospects, wage, bonus and recruitment plans.
Companies were also asked for their views on work stress as this is becoming more prevalent affecting not only worker health and safety but also productivity and profits.
2.0 Summary of Key Findings - Fifth Year of Cautious Optimism
2.1 Despite the lack of cheer and continuing glum about the economy, the good news is that companies are only slightly more cautious compared to last year.
2.2 2015’s basic wage increase averaged 3.5 to 4.0% slightly lower than the 4.1 to 4.3% in 2014,
- for 2016, the basic wage increase is expected to be marginally lower at 3.5 to 3.7 %.
2.3 This year’s variable bonus (excluding AWS) averaged 1.8 months;
- for 2016, it is also likely to be slightly lower at 1.5 to 1.7 months
2.4 The total wage increase for 2015 was 3.3%, and with the Consumer Price Index at minus 0.2%, the real wage increase was 3.5%;
- for 2016, the total wage increase is expected to be 2.7%, and with CPI expected to be around 1.1%, real wages are expected to increase by 1.6%
2.5 On recruitment, 78% of companies hired staff in 2015, fewer than the 83% in 2014;
- for 2016, however, not only are there less companies hiring (71%) but the number to be hired is also expected to be lower.
2.6 Fewer companies retrenched, 8% in 2015 compared to the 10% in 2014
- for 2016 only 3% of companies, so far, expect to retrench.
2.7 Staff turnover was lower in 2015 than the year before;
- for 2016, less companies are expected to experience staff turnover, 72% compared to 85.6% in 2015 and the turnover rate is also expected to be slightly lower.
2.8 Work stress is very prevalent as practically all companies are affected quite seriously
- 74% of management staff and 38% of executive staff are experiencing significant to a lot of stress, but, fortunately, only 7% of rank and file staff are similarly affected.
2.9 Causes of work stress are mainly job demand, tight deadlines, lack of support, long hours, lack of resources, boss/co-worker relationships and lack of autonomy.
2.10 The steps that companies can and should take to address these concerns are, fortunately, not very difficult as they involve mainly top-down initiatives such as regular staff/management review on job/workload and work stress issues among others.
3.0 Key Findings
3.1 Business Prospects
Current: 76% of companies reported satisfactory or better business prospects compared to 80% last year
- the most satisfied sector was Healthcare/Pharmaceuticals.
More companies reported unsatisfactory business prospects 24% compared to 20% last year
- as in last year, the least satisfied sector was Consumer Products/Retail.
European companies were the most satisfied (100% satisfied or better) followed by Japan and Asia Pacific companies (86%). Local and US companies were the least satisfied (67%).
Next 6 months: 17% of companies expect prospects to improve, 68% expect no change while 16% expect prospects to worsen
- Construction/Property is the most optimistic sector,
- Trading sector is the least optimistic.
European companies are most optimistic over next 6 months, while US companies are the least optimistic.
In terms of size, medium-sized companies are optimistic, while large and small companies are least optimistic.
3.2 Basic Wage Increase
The wage increase in 2015 averaged 3.5 to 4.0%, lower than the 4.1 to 4.3% in 2014.
Highest Paying Sector : Construction/Property (4.2 to 5.3%)
Lowest Paying Sector : Consumer Products/Retail (2.9 to 3.7%).
In 2015, 3% of the companies cut wages; more companies froze wages, 9% of companies compared to 7% in 2014.
For next year 2016, the wage increase will average 3.5 to 3.7% with 7% of the companies planning to freeze wages and 1% planning to cut wages.
For 2016, the sector expecting the highest wage increase is Chemicals/Oil&Gas (3.9% to 4.3%) with Financial & Related sector expecting to have the lowest wage increase, 2.6 to 3.0%.
Medium-sized companies paid the highest wage increases, 3.8 to 4.5% in 2015 while small companies paid the least (3.1 to 3.4%). Large companies paid wage increase at averaged of 3.9% in 2014, remain the same this year, and expect to be 3.9 to 4.0% in 2016.
Overall, local companies paid the highest increases of 3.6 to 4.3% in 2015 and for 2016, Japanese companies expect to pay the highest increases of 3.8 to 4.0%.
3.3 Variable Bonus (excluding AWS)
For 2015, the variables bonuses averaged:
1.8 months for Managers
1.8 months for Executives
1.7 months for Non-executives.
Highest Paying Sector – Chemicals/Oil&Gas (3.0 months)
Lowest Paying Sector – Consumer Products/Retails (0.3 to 0.6 months)
Large companies paid higher bonuses (2.2 to 2.4 months) than the 1.4 to 1.8 months of the small and medium-sized companies.
More companies paid bonuses this year, 92% compared to the 88% in 2014.
For next year 2016, 84% of companies expect to pay some form of bonus and the bonuses are expected to be:
1.7 months for managers
1.6 months for executives and
1.5 months for non-executives.
The highest bonus paying sector next year will continue to be Chemicals/Oil & Gas sector which expect to pay bonuses at 2.3 to 2.4 months while the lowest paying sector, will continue to be Consumer Products/Retails sector at 0.4 to 0.7 months.
In 2015, 88% of companies paid an average of 1 month while for next year 89% of companies expect to pay the AWS.
In 2015, a total of 78% of the companies hired staff, fewer than the 83% in 2014.
For next year 2016, 71% of the companies plan to hire staff.
The average number recruited per company in 2015 and the number to be recruited next year are:
More companies froze recruitment 27% of the companies this year (17% in 2014); for 2016, 30% expect to freeze recruitment.
Slightly fewer companies retrenched this year, 8% of the companies compared to 10% in 2014.
For next year, 3% of the companies plan to retrench.
3.7 Staff Turnover
This year, 86% of companies experienced staff turnover.
The annual turnover rate for 2015 averaged:
6% for Managers
10% for Executives and
10% for Non-Executives.
For next year fewer companies (72%) are likely to experience staff turnover and the turnover rate is also expected to be slightly lower.
3.8 Total Accumulated Monthly Variable Component (MVC) in % of Monthly Salary
Slightly more companies, 56% compared to 50% in 2014, paid the MVC. The average accumulated amount is less than the 10.0 to 11.1% in 2014. In 2015 the MVC averaged:
10.5% for Manager
10.1% for Executives
9.9% for Non Executives.
3.9 Entry-Level Salaries
At the lower end, GCE ‘N’ & ‘A’ saw increases of $100, PSC(Secretary) $30, Higher Nitec $50 while at the tertiary levels, Diploma(Oth) saw increases of $200, Degree(Engineering) $100, Degree(Oth) $50 and MBA $300.
3.10 Work Stress
3.10.1 Practically all companies reported that their management staff, executives and also the rank and file are experiencing some form of work stress
- 74% of management staff are experiencing very significant to a lot of stress compared to 38% of executives and only 7% of rank and file.
3.10.2 The main causes of stress are:
3.10.3 The steps that companies can and should take to address work stress are:
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