RDS 2011 Survey on Wage Increase/Bonus, Recruitment & Ministerial Pay Review.
RDS surveyed 128 companies in June 2011 to find out about their wage increase, bonus, recruitment plans and also their views on the Ministerial pay review.
2.0 Summary of Key Findings
2.1 Due to expectation of a moderated economic growth in the second half of 2011, the business outlook for the next six months dipped slightly. As a result, companies are also somewhat cautious on wage increases, bonuses as well as recruitment.
2.2 The basic wage increase this year will average around 4.1%, higher than the 3.6% in 2010 but not substantially higher as the strong 2010 growth would have led some to expect.
2.3 Variable bonuses (excluding AWS) will average 2.2 months, slightly lower than the 2.3 months in 2010. The total wage increase will be only 3.4% which will result in a small decrease in real wages of around 0.1 to 0.6% as the consumer price index inflation for the whole of 2011 is expected to come in at the upper half of 3 to 4%.
2.4 For the first half of 2011(similar to last year), 77% of companies hired staff but for the second half, less companies (59%) expect to hire and the numbers to be recruited per company is also expected to be lower than in the first half of the year.
2.5 7% of the companies retrenched or expect to retrench staff in 2011, slightly less than the 8% last year.
2.6 85% of companies experienced staff turnover in 2011, same as in 2010. The turnover rate is expected to average 7 to 8%.
2.7 Entry-level salaries increased significantly across the board over the last six months. The increases ranged from 1.4% to 9.3%.
2.8 On the Ministerial pay review, most companies felt that the pay formula should be pegged to the national wage levels using a suitable multiple of median wage and interestingly, while integrity, compassion and superior emotional quotient (EQ) were rated very highly as required competencies, superior IQ was not.
3.0 Key Findings
3.1 Business Prospects
Current: 91% of companies reported satisfactory or better prospects, slightly lower than the 93% six months ago.
- Unlike six months ago when practically all companies were reportedly satisfied, a minority of companies in eight of the ten sectors reported unsatisfactory business prospects. Currently, the Financial/Insurance and Aviation sectors are the most satisfied.
Next 6 months: 23% of companies expect prospects to improve, 74% expect no change and while 3% expect prospects to worsen
sector is the most bullish with 88% of companies expecting prospects to
improve while a few companies in two sectors, Manufacturing and Trading
expect prospects to worsen.
European and Local companies did well (93% satisfied or better with current prospects).
European companies are the most optimistic over the next six months as 50% expect conditions to improve or better.
Large companies fared better than the rest (94% satisfied or better) compared to 91% of small-sized and 89% of medium-sized companies.
The large and small sized companies are the most optimistic over the next six months with 26% expecting conditions to improve compared to 20% of medium-sized companies.
3.2 Basic Wage Increase
Overall, the wage increase for 2011 is expected to be around 4.1%, higher than last year's 3.6%.
3.3 Variable Bonus (excluding AWS)
For this year, 80% of companies expect to pay the on month of AWS.
For the first half of 2011, 77% (similar to last year) of companies hired staff but for the second half, less companies (59%) expect to hire and the number to be recruited per company is also expected to be lower than in the first half.
The numbers recruited per company in the first and second halves of 2011 are:
7% of the companies retrenched or expect to retrench staff in 2011, slightly lower than the 8% last year.
3.7 Staff Turnover
85% of companies experienced staff turnover in 2011, same as in 2010. The annual turnover rate is expected to average:
3.8 Total Accumulated Monthly Variable Component (MVC) in %
35% of companies pay the MVC and the average accumulated amount in 10.3%(Managers), 10.2%(Executives) and 9.9%(Non-Executives).
3.9 Entry-Level Salaries
Entry-level salaries increased across the board compared with six months ago.
For GCE ‘N’, ‘O’ levels, Diploma (Others), Degree (Engineering) and MBA holders, they increased more than 5% whereas for GCE 'A', PSC (Secretary), Nitec, Higher Nitec, Diploma (Engineering) and Degree (Others) increased by 1.4% to 4.1%.
3.10 Ministerial Pay Review
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