(SPOT.ph) Filipinos can expect their salary increases in 2023 to reach pre-pandemic levels as businesses continue to recover from the pandemic, global consulting firm Mercer said Wednesday, November 23.
Salary increases that employees in the Philippines will receive next year could amount to 5.5%, equal the rate in 2019 and higher than this year's 5.3%, according to Mercer's 2022 Total Remuneration Survey.
A total of 447 organizations across 11 industries in the Philippines participated in Mercer's annual survey from April to June this year.
The Philippines' median salary increase for 2023 is also higher than the Asia Pacific average of 4.8%, with India receiving as high as 9.1% salary increase and Japan having the lowest in the region at 2.2%.
“Salary increases are gradually increasing now that business activities in the Philippines are picking up post-pandemic. But inflation hit a high this year and there was little to no real salary increase for employees," said Floriza Molo, Mercer’s Career Business Leader for the Philippines.
"The situation will improve for 2023, as the market outlook is forecasted to improve with lower inflation rates. Employees will be able to benefit from some real salary increase, which will be welcome news for many," she added.
Which industries will receive the highest salary increases?
According to Mercer's survey, the Shared Services industry is set to offer the highest salary increase at 6%. These involve jobs that provide support to other departments within a company, such as human resources, finance and accounting, information technology, supply chain, and other front and back-office services.
It is closely followed by the High Tech, Life Sciences, and Logistics industries at 5.8%, while the Services (Non-Financial) and Chemicals industries are forecast to offer the lowest salary increments, at 5% and 4.6%, respectively.
“The Shared Services and High Tech industries are not showing signs of slowing down. As companies were forced to accelerate their digitalization plans during and post-pandemic, there continues to be high demand for tech-based products and services which are in turn generating employment opportunities," Molon said.
"But some industries like Services (Non-Financial) and Chemicals remain cautious about their 2023 outlook as business demand is just starting to pick up," she added.
What employers need to do to keep their employees
The study showed that more than one-third, or 36%, of the organizations surveyed plan to hire more employees next year, while 38% intend to retain their current headcounts. The unemployment rate is also projected to dip to 5.4% in 2023 from the high of 7.8% in 2021.
Despite this observation, Mercer said employers should also be able to adapt to the new normal and devise ways to keep their employees as it noted a 6.7% voluntary attrition rate as of mid-2022.
"Employers should prioritize employees’ well-being, and create a nurturing yet purposeful work environment that meets both business and personal needs," said Godelieve van Dooren, Mercer’s CEO for South East Asia Growth Markets.
"Offering flexible work arrangements, support for mental and physical wellness, as well as relevant training and development programs are some ways employers can cultivate, retain and engage their workforce," she added.