- Salary increases in 2021 were lower than in 2020; bonus pay-outs dropped approximately 25 percent.
- Some industries, such as private banking, saw continued increases in salaries while retail and professional services faced challenges.
SINGAPORE – Media OutReach – 15 December 2021 – The COVID-19 pandemic has weighed heavily on talent strategies with muted salary increases across Southeast Asia, according to a study by Aon plc (NYSE: AON), a leading global professional services firm. The second edition of Aon’s 2021 Salary Increase and Turnover Study was conducted from June 2020 to June 2021, surveying the salary movements and turnover rates of more than 870 companies across Singapore, Malaysia, Thailand, Indonesia and Vietnam.
Companies must prepare for potential talent risks in 2022 following a muted 2021
In Singapore, salary increases across industries dropped to 3.3 percent in 2021 from 3.8 percent in 2020. Similar trends were seen in Malaysia and Thailand, with 2021 salary increases of approximately 4.5 percent and 4.4 percent, compared to 4.7 percent and 4.9 percent in 2020, respectively. Bonus pay-outs, which were relatively insulated in 2020–calculated for the previous performance year–also dropped between 20 – 25 percent in 2021 across Southeast Asia.
However, as organisations settle into new and agile workforce models, compensation policies are expected to normalise to pre-pandemic levels in 2022. The study showed that salary increases for Singapore, Malaysia and Thailand are forecasted to recover to 3.8 percent, 4.9 percent and 4.9 percent, respectively, in the coming year.
Voluntary turnover in 2021 remained either mostly flat or declined, as reported in Singapore (from 11.3 percent in 2020 to 10.8 percent in 2021) and Malaysia (from 10.6 percent in 2020 to 8.7 percent in 2021), demonstrating there is hesitation in switching employers amid an uncertain business landscape.
However, as the Southeast Asian economy is poised to recover, Aon expects turnover to increase following the current downturn.
Rahul Chawla, Managing Director, Aon’s Human Capital Solutions, Southeast Asia, said: “Organisations need to prepare for and have the right strategies for global talent trends such as ‘The Great Resignation.’ This will be further complicated by other factors introduced by the pandemic, such as new working models and a higher demand for digital skills. However, these extraordinary times also present opportunities for companies to stay ahead of the curve in the war for talent as they continue to build resilient workforces. We expect to soon see a surge in hiring and turnover activity so rethinking compensation and benefits strategies will be a critical success factor to prepare for the next year.”
Retail, hospitality, and professional services continue to face headwinds
The study also revealed how the pandemic impacted individual sectors. In financial services, the consumer banking industry saw minimal salary increases due to prevailing macro-economic conditions and the business performance of banks. However, private banking saw continued salary growth on the back of continued wealth creation in the region and the need for sophisticated financial planning. Similarly, the life sciences and medical devices industries saw salary increases in Singapore, Malaysia and Thailand of 3.6 percent, 4.6 percent, and 5.0 percent respectively. In contrast, retail, hospitality, and professional services continue to face headwinds; for example, the Singapore market saw a salary increase of just 3.0 percent in the consulting and professional services industry.
To address some of these challenges, data from Aon shows that organisations have invested in different talent groups and skillsets. For example, in response to the growing importance of digital solutions in new working models and the need to address the increased risk to employee health and wellbeing, salaries in IT and human resources in certain economies such as Thailand showed the strongest recovery, with salaries for junior employees increasing by up to 20 percent.
Median Salary Increase in 2020 and 2021
| Country/Territory | Salary Increase 2020 | Salary Increase 2021 |
| Singapore | 3.8% | 3.3% |
| Malaysia | 4.7% | 4.5% |
| Thailand | 4.9% | 4.4% |
| Indonesia | 7.5% | 6.5% |
| Vietnam | 8.5% | 7.5% |
Median Voluntary Turnover in 2020 and 2021
“The trends observed for 2021 reflect the phases of react, recover and reshape that most companies have experienced in the last 18 months. With higher vaccination rates across Southeast Asia and the resumption of travel, the expectation in 2022 is for a long-awaited recovery where we will see more movements in the talent market. While continuing to fight the war for talent, organisations can leverage these data and insights to make better, more informed decisions as they build roadmaps to deliver enhanced value for employees in the future,” said Chawla.
To view the study, please click here.
About the study
Aon’s Salary Increase and Turnover Study provides clients with actionable insights to ensure their pay cycles are aligned with overall market trends. Conducted twice a year, the study spans more than 130 countries/territories and 4,100 companies globally.
The Salary Increase and Turnover Study covers the following key market practices:
- Actual overall and merit-based salary increases
- Budgeted overall and merit-based salary increases
- Expected hiring and workforce growth trends
- Key talent identification and rewards differentiation practices
- Performance management practices
- Promotion practices
- Salary structure movement trends
- Voluntary and involuntary turnover rates
About Aon
Aon plc (NYSE: AON) exists to shape decisions for the better — to protect and enrich the lives of people around the world. Our colleagues provide our clients in over 120 countries with advice and solutions that give them the clarity and confidence to make better decisions to protect and grow their business.
Follow Aon on 
Twitter and 
LinkedIn. Stay up-to-date by visiting the Aon Newsroom and sign up for News Alerts here.
#Aon
The issuer is solely responsible for the content of this announcement.
Services
Stakeholder mapping, analysis, engagement and communication needs to be detailed to avoid business losses or even worse, a crisis. How can you do this effectively to prevent failure? ...
Data-driven business decisions have never been as crucial, especially in this era. MGBF leverages off, technology, experience and market presence to aid businesses in making accurate decisions. ...
MGBF provides comprehensive strategic advice and results-focused solutions to solve clients' problems in business-government relations so they can focus on their core business. ...
A critical business challenge is meeting the right decision-makers and potential buyers through the best channel and platform. How will you improve your business competency? ...
Upcoming Events
MGBF founding chairman Nordin Abdullah and UMW Toyota president Datuk Ravindran K. will delve into the convergence of automotive innovation and environmental sustainability in Penang, Sarawak, Johor and Pahang.
Hosted by menumiz™ – an end-to-end restaurant management system – this roundtable will feature a case study presentation and a panel session to discuss the latest digital trends, challenges, and opportunities within the food and beverage sector.
In this episode of 'A Working Lunch with Nordin', MGBF's founding chairman, Nordin Abdullah, will host this discussion focusing on the biggest threats and opportunities for businesses as we look to manage change in the South China Sea.
This MGBF Roundtable will focus on regional food security issues and trends in the regional supply chain, and trade regulations and policies, including a new geopolitical tool i.e., weaponisation of supply chains.
MGBF In The News
News provided by Emjay Communications Malaysia and China commemorated a historic milestone of 50 years of diplomatic relations with a grand celebration at Sunway Velocity Mall on the 10th of August 2024. The event, themed “Hi China: Discovering China Opportunities and Celebrating 50 Years of China-Malaysia Relationship,” aimed to deepen […]
Planet QEOS, KIS BlOCNG San Bhd, and the Sarawak Land Consolidation and Rehabilitation Authority (SALCRA) have officially signed a tripartite memorandum of understanding (MoU) to establish a collaborative framework aimed at producing bio-hydrogen via the Steam Biomethane Reforming (SBMR) Process. The MoU was signed by Planet QEOS executive chairman Dino […]
Planet QEOS and China Machinery Engineering Corporation (CMEC) are interested in investing RM10 billion to co-develop advanced Megawatt peak (MWp) agrovoltaic in Baram, to further boost Sarawak’s green energy initiative and food security. Sarawak Premier Datuk Patinggi Tan Sri Abang Johari Tun Openg was briefed on Friday by both the […]
Last week SPM results came out, 373,974 aspirants who have been waiting patiently over the last few months would now know their fate. Some 10,109 have received all A’s, the golden standard of academic success and the ticket to those looking to study the “more advanced” subjects in university. Proudly, […]
The classic knee-jerk reaction is to say, fire the coach, change the leadership of associations, and reduce the funding till they start performing better. This kind of negative reinforcement may work for kindergarten children, but we are dealing with high-performance adults – individuals much further along in their psychological and […]
Since its earliest tea plantations in 1929, Cameron Highlands has grown to become a key player in the agricultural landscape of Malaysia, producing 40 per cent of all vegetables grown. Despite Malaysia shifting its economic focus away from agriculture, the industry remains imperative for food security and the livelihoods of […]
Although at first glance the travel industry and the agricultural sector appear to have nothing in common, they actually share more than meets the eye. The economic benefits of tourism to the agricultural sector can be multiplied several times over. “Tourism brings the end consumers closer to the source, which […]
The Malaysia Global Business Forum (MGBF) recently held a high-level roundtable themed ‘Designing the Future of the Digital Economy’, attended by industry leaders and business associations. The guest of honour was Yang Berhormat Syerleena Abdul Rashid, the Member of Parliament (MP) for Bukit Bendera in Penang. The MP’s Special Session […]
The Malaysia Global Business Forum (MGBF) will be hosting a roundtable on ‘Designing the Future of the Digital Economy’ on 23 February 2023. It is the culmination of the first three MGBF Exclusive Roundtable Series titled ‘The Evolving Threat Matrix in the Digital Economy’ held throughout 2022. According to the […]
The Founding Chairman of the Malaysia Global Business Forum (MGBF), Nordin Abdullah, today spoke on Bernama TV’s leading English talk show, The Brief, hosted by Jessy Chahal, on the topic of a stable political reality and what that means for the Malaysian economy. Nordin said, “The first thing that it […]
More than 1,100 years ago, Muhammad ibn Musa al-Khwarizmi was developing the mathematical formulas that we know today as algorithms which now have become so intertwined with the business fortunes of global media giants and the very fabric of geopolitics. A series of recent high level international reports have revealed […]
KSK Land has been recognised by the Malaysia Global Business Forum (MGBF) for its role in attracting high net-worth individuals to Malaysia post-pandemic. The first challenge in investor attraction is “selling” the country. In the context of Asia, Malaysia is competing with some very established investment destinations. The second […]
Malaysia, in particular Kuala Lumpur, continues to position itself as a regional centre to do business, educate a family and enjoy a global lifestyle. One company, KSK Land, has taken the lead in positioning itself and the city of Kuala Lumpur as a property investment destination for the global citizen […]
The upcoming budget represents an opportunity to build resilience in the critical sectors that will form the backbone of the country’s future-facing economic ambitions. This however needs to be achieved in the context of managing the community sectors most impacted by COVID-19 over the past two years. The Keluarga Malaysia (Malaysian Family) […]
Malaysia Global Business Forum (MGBF) has moved to support the creative economy as the overall economy moves into a recovery phase following the COVID19 pandemic. As a step in the direction of normalcy, the MGBF has agreed to host the art exhibition “I Know You’re Somewhere So Far” by one […]
Congratulations to Datuk Seri Ismail Sabri Yaakob for taking up the mantle of the ninth prime minister of Malaysia. There is nothing normal about the situation; it could not have been scripted but it has kept the spectrum of media, mainstream and social, gripped. The first order of business for […]
In a stirring speech to the nation, President Joseph R. Biden, Jr. stamped his brand of leadership on the presidency, in his first act as the 46th president of the United State of America, it signaled several shifts. Perhaps the weather was foreboding with snow falling before the ceremony that […]
KUALA LUMPUR, 6 July 2022 – As the global economy continues to deal with unprecedented levels of disruption caused by the pandemic and the conflict between Russia and Ukraine, the convergence of energy security and food security issues has become a front-of-mind issue faced by policy makers and consumers alike. […]
KUALA LUMPUR, 23 June 2022 — Malaysia Global Business Forum (MGBF) ties up with scoutAsia to ensure that businesses are equipped with deeper regional insights. The past two years has seen a massive shift in the way businesses are conducted with digitisation, digitalisation and automation continuously being adopted to improve […]
KUALA LUMPUR, 25 May 2022 – The Malaysia Global Business Forum (MGBF)’s exclusive roundtable on ‘Security Concerns in Critical Value Chains’ was held in a hybrid setting yesterday at the Eastin Hotel Kuala Lumpur. The guest of honour was Yang Berbahagia Tan Sri Dato’ Seri Rafidah Aziz, former minister of […]
