Malaysia To See Lower Real Salary Increase In 2020
The real money value of salary increments in 2020 may be lower than previous years. Human resource consulting firm ECA International has released a report that indicates that while salaries in Malaysia will see a substantial jump next year, it will be matched by a sizable inflation rate.
Malaysian workers are set to be some of the few that see their real salary increase drop. According to the report, the real salary increase will decline to 2.9% from 4.0% in 2019.
This is not to say that increments will be smaller. Lee Quane, Regional Director – Asia at ECA International explains that the salary increase is likely to stay 5.0%. However, his researchers foresee that inflation will go from 1.0% to 2.1%; which is where the negative impact on real salary increment comes from.
The change in rate has sent Malaysia out of the top ten countries for salary increments; which is currently lead by India, Vietnam, and Indonesia.
Despite this reduction, the increase is still double the global average of 1.4%; and is far ahead of the 1.1% increase predicted for Europe.
The real salary increase takes into account the forecast salary increase determined by a survey of 307 multinational companies. It also subtracts the expected inflation for the surveyed countries in order to account for the change in purchasing power change.