Real salaries in Singapore are estimated to rebound in 2024 as inflation eases, said ECA International recently.
Workers in city state can expect to receive a salary increase of 4.0% in nominal terms in 2024, consistent with the rate in 2023, according to the firm.
In 2023, though nominal salaries in the city sate increased by 4%, the 5.5% inflation rate resulted in a drop in real salaries in Singapore, ECA observed.
- Region wise, real salary increases in Asia Pacific once again took the lead in 2023, outperforming the rest of the world and securing top positions in the rankings.
- Nine of the 12 locations with the highest real salary increases in the world are in the region, said ECA.
- The average forecast rate of increase in real terms in the region for 2024 is 2.2%, more than double the global average of 1%, ECA pointed out.
- Most surveyed locations in the APAC region are likely to maintain or exceed their 2023 real salary growth rates in 2024, with the exceptions being Sri Lanka and New Zealand, the firm added.
- In Hong Kong, salaries in nominal terms rose 4.0% in 2023 and are projected to increase at the same level in 2024, ECA said.
- Workers in Hong Kong have also benefited from below-average rates of inflation compared to their APAC and global counterparts, resulting in continued salary increases in real terms next year, ECA noted.
- After taking inflation into account, the real forecast salary increase in Hong Kong will be 1.7% next year, 0.1% lower than 2023.
Other regional highlights
- In Malaysia, salaries increased by 2.1% in 2023 in real terms and are expected to grow further by 2.3% in real terms in 2024.
- Vietnam led the way in ASEAN in 2023 with a salary growth of 3.6% in real terms, a rate which is forecast to be the same in 2024.
- Conversely, workers in Laos experienced a significant decrease in salaries in real terms in 2023, with salaries falling by 23.1% in real terms due to a soaring rate of inflation of 28.1%.
- Salaries are forecast to continue to decrease in real terms in 2024. However, a real terms fall by a further 3.0% is an improvement from the previous year as the rate of inflation is expected to fall substantially to 9.0%.
- In 2023, workers in China experienced a nominal salary increase of 5.3%, and this is expected to rise to 5.8% next year.
- Notably, China recorded the lowest rate of inflation in the region for 2023, at just 0.7%, with a forecast increase to 1.7% in 2024.
- Consequently, the average salary increases in China in real terms stand at 4.6% in 2023, making it the third-highest globally and the second-highest in the region. Projections for 2024 anticipate a real salary increase of 4.1%, remaining in the top three both globally and regionally.
- Globally, the average salary increase in nominal terms was 5.0% this year and is forecast to be the same in 2024.
- Inflation rates are expected to fall from an average of 5.5% this year to 3.6% next year.
- After factoring in inflation, globally salaries fell by 0.9% on average in real terms in 2023, but they are expected to return to growth in 2024 where average salaries will grow by 1.0% in real terms.