HK's salaries stagnate as mainland flies
The world's largest salary raises next year will come from Asian emerging markets where economic growth continues to burn brightly, according to a survey by human resources consultant ECA International.
The mainland will have the highest real wage increase in the world in 2011, up from an estimated 4.8 per cent pick-up this year, ECA said.
India and Indonesia are expected to round out the top three spots in the global rankings.
'Salary increases in the region continue to be largest within developing Asia,' said Lee Quane, regional director, Asia, for ECA.
'This is partly to keep up with inflation and partly due to demands of higher economic growth prompting widespread skills shortages in these locations.'
Asia-Pacific's developed markets may not be so fortunate, however.
The survey, the results of which were released yesterday, said real wages in Hong Kong might only increase by 0.5 per cent next year, the second-lowest pace in the region and 49th overall among 57 economies measured. Singapore ranked 25th.
Hong Kong salaries were expected to pick up by 3.5 per cent, but the increase would be mostly negated by an estimated inflation rate of 3 per cent, ECA said.
Real wage increases are defined as the percentage increase in nominal base salary minus the inflation rate.
The survey gathered information from August to October this year, polling more than 300 companies worldwide across various industries. Nearly two-thirds were multinational corporations.
The pick-up in salaries across the border comes as emerging Asian economies are revving-up growth on the back of robust domestic consumption levels.
On the mainland, for example, retail sales in September surged year on year by 18.8 per cent, the highest level since February.
Central banks in both the mainland and India have recently raised interest rates to temper economic advances.
But salaries generally start at a substantially lower base in emerging markets.
Quane said the news that mainland salaries would rise would not necessarily lead to a brain drain.
'For a typical employee in Hong Kong, the corresponding mainland salary for most levels of seniority in most industries is still much, much lower,' he said.
Hong Kong had the 24th highest per-capita income in the world last year at US$29,802, according to data from the IMF. The mainland ranked 98th, with US$3,734.
Minimal gains
HK salaries may rise by 3.5 per cent, but this will be negated by inflation
Real wages in Hong Kong may only increase by this much next year: 0.5%
This is the second lowest pace in the region and, out of 57 economies, places the country: 49th
