This reflects growing optimism among employers about their business and overall market outlook. Malaysia’s gross domestic product (GDP) is estimated to grow by 6.4% this year, exceeding pre-pandemic levels of 4.4% in 2019.
The survey polled 637 organisations, of which 98% are multi-national companies, across 17 industries in Malaysia between April and June this year.
Malaysia’s median salary increment, which registered 4.8% this year, is also above the Asia Pacific average of 4.4%. Across Asia, the overall median salary increases reflect a divergence in pay progression between emerging and developed economies, with estimates as high as 7.1% in Vietnam to 2.2% in Japan, the lowest in the region.
Across the industries surveyed, the retail and consumer goods industries are expected to see the biggest upturn in salary increment of 5% in 2023, up from 4.5% and 4.6% respectively this year. Shared services and outsourcing (SSO) and high-tech industries maintain their 5% increase from this year, signalling the relative stability of both industries amidst inflationary pressures and supply chain issues.
Koay Gim Soon, Mercer’s career business leader for Malaysia, said as Malaysia is rebounding from the pandemic, companies especially the MNCs are more certain about the future and are ramping up their business activities to cope with increased demands.
Employees, except for those from the high-tech industry, can also expect higher bonus payouts this year, based on Mercer’s mid-2022 forecast. The retail industry is expecting the biggest jump to 12.6%, from 8.1% in 2021, followed closely by the consumer goods industry with an increase to 16%, from 13.7% the previous year.
SSO is forecasting the highest payout of 20.3%, exceeding high tech’s 19.9%, which reflects the former’s growth potential in Malaysia leading to greater competition for talent.
However, employers are also keeping a close eye on global headwinds including inflation and supply chain disruption which may dampen growth in the year ahead. Hence, the retail and consumer goods industries, despite recording the highest increases from 2021 to 2022, remain the most conservative in their forecasted bonus payouts.