SHRI/RDS 2010/2011 Survey on Staff Engagement Priorities.
SHRI in conjunction with RDS surveyed 151 companies in December 2010 to find out about their wage increase, bonus and recruitment plans in the light of the booming economy.
As a follow-up to our previous findings that companies are focusing more on improving staff engagement to drive productivity growth, we wanted to find out what specifically are their priorities in this area. Additionally, on the on-going issue of the minimum wage, we thought it would be interesting to find out what companies thought about its effects on low-wage workers and their employment.
2.0 Summary of Key Findings
2.1 The booming Singapore economy boosted the fortunes and confidence of most companies in 2010. Practically every company in every sector had a very good year.
For 2011, most companies are equally confident about business prospects although some lingering anxieties about the sustainability of the global economic recovery remain. With cost concerns and rising salaries continuing to worry many companies, restraint on wage increase and bonuses are still evident. This restraint is also reflected in the slight decline in recruitment, staff turnover and training hours.
2.2 Basic wage increases in 2010 year averaged 3.6% significantly higher than the 2.8% projected six months ago. For 2011, the wage increase is projected to increase further to an average of 4.0%.
2.3 Variable bonuses (excluding AWS) averaged 2.3 months in 2010 much higher than 2009’s 1.7months. This resulted in a total wage increase of 7.4% a substantial improvement over last year’s 1% decrease. For 2011, the variable bonuses are expected to decline slightly to 2.2 months.
2.4 A total of 77% of the companies hired staff in 2010. For 2011, slightly less companies (68%) plan to hire. The number to be recruited per company in 2011 is also slightly lower than in 2010.
2.5 8% of the companies retrenched staff in 2010; in 2011 only 3% expect to retrench.
2.6 85% of companies experienced staff turnover in 2010 and the annual staff turnover rate averaged 9%. For 2011, less companies, (54%) expect to experience staff turnover.
2.7 Entry salaries for GCE ‘A’ level, Nitec, Higher Nitec, Degree (Others) and MBA holders increased by 1% to over 5% over the last six months of 2010 while those for GCE ‘N’& ‘O’ levels, PSC (Secretary), Diploma (Engineering), Diploma (Others) and Degree (Engineering) remained unchanged.
2.8 To enhance staff engagement, most companies are investing in developing and training their supervisors and managers to handle subordinates more effectively alongside more effective pay incentives and customisation of benefits.
2.9 On the Minimum Wage issue, 41% of companies are not sure of its effects with 34% believing it will benefit low-wage workers. 15% on the other hand, think it will reduce low-wage employment while 8% think it will increase low-wage employment.
3.0 Key Findings
3.1 Business Prospects
of companies reported satisfactory or better prospects.
Although this was slightly lower than the 94% six months ago, practically
all industry sectors were satisfied with the Financial/Insurance sector
being the most satisfied.
Next 6 months: 29% of companies expect prospects to improve, 70% expect no change and only 1% expect prospects to worsen
except for one or two companies, all sectors are relatively optimistic with
the Food & Beverage/Hotels being the most bullish.
Out of the 16 industry sectors, only a few companies in several sectors reported some form of unsatisfactory business condition.
Asian Pacific, European and Japanese companies did well (100% satisfied with current prospects).
European companies are the most optimistic over the next six months as 56% expect conditions to improve or better.
Small companies fared better than the rest (96% satisfied or better) compared to 93% of large-sized and 91% of medium-sized companies.
The small companies are also the most optimistic over the next six months with 43% expecting conditions to improve compared to 25% and 15% of medium-sized and large companies respectively.
3.2 Basic Wage Increase
Overall, the wage increase for 2010 averaged 3.6%; for this year 2011, the wage increase is expected to be higher at around 4.0%.
3.3 Variable Bonus (excluding AWS)
83% of companies paid the AWS averaging 1.0 month of basic salary in the year 2010 and for 2011, only 81% of them expect to pay the AWS.
A total of 77% of the companies hired staff in 2010. For 2011, slightly less companies (68%) plan to hire. The number to be recruited per company in 2011 is also slightly lower than in 2010.
The numbers recruited per company in 2010 and for this year are:
8% of the companies retrenched staff in 2010; this year only 3% expect to retrench.
3.7 Staff Turnover
85% of companies experienced staff in 2010 and the annual turnover rate averaged:
For 2011, less companies, (54%) expect to experience staff turnover.
3.8 Regular Staff Training Hours
67% of companies provided regular staff training in 2010 and for this year less companies (60%) expect to do so.
The average numbers of training hours per employee are:
Large companies generally provide more training than the medium and small companies.
The Asia Pacific and local companies, on the other hand, provide more training than European, US or Japanese companies.
3.9 Entry-Level Salaries
Entry-level salaries for Nitec, Higher Nitec and Degree (Others) increased by 2.1% to 2.8%, those for GCE ‘A’ level increased by 5.7% and those for MBA by 1.0%.
As for GCE ‘N’, ‘O’ levels, PSC (Secretary), Diploma (Engineering), Diploma (Others) and Degree (Engineering), they remained the same over the last six months of 2010.
3.10 Priorities for Enhancing Staff Engagement
3.11 Effects of Minimum Wage
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