Global Economics

Want a Big Raise? Move to Asia (but Avoid Japan)


For white collar workers in many parts of Asia, this is a good time to ask for a raise. Recruiting specialist Hays has just published its annual survey of more than 2,600 employers in China, Hong Kong, Japan, Malaysia, and Singapore and found that, with the notable exception of Japan, workers can expect significantly fatter pay packets this year. “Asia remains a hotbed of recruitment activity [PDF] and omnipresent high-level skills shortages are the continuous bane of hiring managers,” the Hays report says.

In China, 12 percent of employers surveyed last year increased salaries by more than 10 percent, and another 54 percent of companies gave raises ranging from 6 percent to 10 percent. The Year of the Horse looks to be a good year for workers, too, with Hays finding that 58 percent of Chinese employers surveyed expect to give raises of from 6 percent to 10 percent.

The one disappointment, not surprisingly, is Japan. Stagnant wage growth is a problem for Prime Minister Shinzo Abe’s plan to revive the country’s economy. Base salaries (excluding overtime and bonuses) fell 0.2 percent in December compared to a year earlier. That’s the 19th consecutive month of declining wages.

With prices already rising and a tax increase scheduled to hit in April, consumers need to take home more money in order to feel comfortable spending. That’s why Abe has been using his bully pulpit to pressure Japanese companies to raise wages. The government’s goal is “profits rise, then salaries rise, so consumption will increase, and again profits will rise. We get into a virtuous cycle,” Abe said in an interview with Bloomberg News in December. “What we want is for wages to rise more than prices.”

Employers in Japan haven’t been too generous, though. According to the Hays survey, 16 percent of Japanese companies gave workers no raise last year, while the 64 percent that did increase salaries limited the raises to less than 3 percent. The outlook is pretty much the same this year, with 64 percent expecting raises of zero to 3 percent and 12 percent of employers surveyed saying they don’t expect to give raises at all.

Another of Abe’s goals is to increase the role of women in the Japanese workforce. Japan ranked 105th among 136 countries in the World Economic Forum’s Global Gender Gap Report last year, and improving prospects for women who want to work is a “vital component” of Abenomics, the Prime Minister wrote in the Wall Street Journal last September. By the time Tokyo hosts the Olympic Games in 2020, he wants women to hold 30 percent of leadership positions in Japanese society.

Again, though, the Hays report shows just how much Japan lags behind the rest of the region. When asked the percentage of women in management positions, China did best  with 36 percent, followed by Hong Kong at 33 percent, Malaysia at 29 percent, and Singapore at 27 percent. Japan was last, with women holding only 15 percent of management positions at companies surveyebd.

Ghost_image
Einhorn is Asia regional editor in Bloomberg Businessweek’s Hong Kong bureau. Follow him on Twitter @BruceEinhorn.

Video Game Avenger
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus