Vietnam to lead Southeast Asia in salary hike next year: survey

The survey of professional services firm Aon, which is listed on the New York Stock Exchange, said Vietnam’s median increase would be 7.9%.

Indonesia will follow with a rise of 6.8%, followed by the Philippines (6%) and Thailand and Malaysia (5.1%).

Singapore will be at the bottom with 4.7%.

Vietnam saw its consumer price index, which measures inflation, rise by 3.15% this year.

The government has identified inflation as one of the key challenges the economy could face in 2023.

While inflation plays a significant role in how salary changes across the region, they are also driven by supply and demand in the talent market, Aon said.

Southeast Asian countries are recording high attrition rates, meaning employees are turning over quickly.

The rate is at 19.6% in Singapore, 18% in the Philippines, 15.9% in Indonesia, 15.4% in Thailand, and 15.2% in Vietnam.

The survey found further that salary increases in 2022 varied across industries, with retail seeing the highest increase (6.5%), followed by technology and life sciences (6.1%) and finance (5.9%).

The ongoing technology and digital skills shortage across the region as a consequence of firms competing to accelerate transformation and drive their digital initiatives resulted in higher increases in salaries and total compensation in technology and data analytics than other industries, the survey said.

Alina Cheng, senior consultant, human capital solutions for southeast Asia at Aon, said: “With the rise of fintech and digital banks in the region, roles in areas such as risk, compliance and talent acquisition are in demand.

“Firms are paying a premium to attract new talent at the junior and middle management levels for these roles.”

The survey polled more than 700 companies across Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam in the third quarter.