SINGAPORE (Reuters) - Most companies across the Asia Pacific region are freezing salaries or increasing them marginally this year, according to a survey, but employees don’t really mind because of the turbulent economy.
A recent poll by global consulting firm Watson Wyatt of more than 1,600 organizations in 11 countries showed that on average, pay rises are down by about 52 percent in the region.
Many companies have also chosen to freeze pay in 2009, especially in places where businesses are seeing a slowdown, such as Hong Kong, Singapore, Japan, South Korea and Taiwan.
Russell Huntington, Asia Pacific director of Watson Wyatt’s Human Capital Group, told Reuters that by comparison with their peers in Europe and the United States, employees in the region were, on average, better off.
He said that in some developing countries, such as Indonesia, companies were not freezing pay at all due to an already weak economy.
“In Asia Pacific, the extent of the salary reduction and pay freeze isn’t as great as in Europe and the United States, where 29 percent and 56 percent of companies are freezing salaries,” he said.
Huntington said that most employees were actually expecting their salaries to remain frozen due to the global economic crisis. “Unless they’re working in those rare sectors where business is still buoyant, most people understand,” he added.
“Companies are desperate to cut operating costs and here is a great opportunity to do so. And in the scheme of things, a missed pay review or a salary freeze is relatively light, and quite different than losing your job.”
The “Regional HR Pulse Survey” was conducted from February to March this year, just as most of the world’s economies slipped into recession or slowed down significantly due to the global credit crisis.
Huntington, however, said despite employees’ understanding of the situation, companies must continue to communicate openly to staff about their finances.
“Companies should make employees understand that they too would do the same thing,” he said. “It is the obligation of the leadership to communicate this, and perhaps ironically, the outcome will be positive.”
Editing by Alex Richardson