Employers set to raise salaries a further 6% this year to retain talent, research suggests
April 04, 2014 00:00 By The Nation 3,006 Viewed
Salaries will go up by an average of 6 per cent this year in Thailand, compared with 5.4 per cent in 2013, according to research by Towers Watson, a global professional-services company.
Towers Watson Thailand’s survey was conducted between January and March on 93 companies across a range of industries from automotive to financial services, insurance, manufacturing, electronics, high-technology and chemicals.
The survey results generally reflect the findings of last year’s annual Total Rewards Survey (TRS), which was conducted from July to October 2013, but provide more recent data. The TRS provides insights on trends in employee compensation and benefits in Thailand. More than 170 companies participated in the survey last year.
Towers Watson says the annual survey is aimed at helping organisations make informed decisions about total reward programmes for their employees. The results can help companies evaluate their salary competitiveness in the market, support their recruitment initiatives and ensure that correct salary adjustments are made for critical roles.
The survey found that for entry-level salaries in 2013 across all industries, the highest were for graduates from the engineering and research-and-development sectors, at around Bt18,000 per month.
The survey also found that the employee turnover rate was higher in 2012 (12.5 per cent) and 2013 (12.8 per cent) than in 2011 and 2010. The industries that experienced the most turnover last year were insurance at 20 per cent, financial services 18 per cent and electronics 17.3 per cent. The average turnover rate from 2008 to 2011 was 9.35 per cent.
In addition, the survey revealed that engineering and sales are the roles where organisations are facing the most issues related to attracting and retaining employees. In fact, talent retention is ranked the No 1 human-resources challenge.
Pichpajee Saichuae, managing director of Towers Watson Thailand, said the supply of high-quality talent was limited. This has put a real challenge on companies’ talent-management programmes, affecting their competitiveness.
Companies were also asked about their strategies to handle uncontrollable external factors such as political situations or natural disasters. The first three responses were review market strategy (45 per cent), review safety and working solutions policy (44 per cent), and offer remote working (42 per cent), while only 7 per cent chose to lay off their staff. “Companies certainly consider the external environment more carefully than they have done in the past, and strategic planning has become critical to ensuring companies have plans in place so that their employees continue to be productive during any event,” Pichpajee said.
The 2014 survey also revealed companies’ key talent strategies to prepare for the Asean Economic Community coming next year. Not surprisingly, the first-ranked response accounting for 65 per cent was to provide internal training on language(s), whereas 58 per cent emphasised leadership development.
“As AEC will bring more foreign employees, [so] it is critical for top managers to develop their capabilities to manage and lead an international workforce,” Pichpajee said.