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2019 Beyond Data HR priorities: Singapore spotlight

Talent
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February 25, 2019

Our Beyond Data local spotlight series explores the top four compensation trends in Singapore.

With voluntary attrition close to 14%, Singapore is a very competitive talent market. As today’s workplace evolves, HR functions are under immense pressure to attract and retain key talent. Our research shows many reasons why an employee would decide to join and stay in an organisation – but compensation is always in the top three.

To shed some light on the compensation landscape in Singapore, we analysed more than 140,000 datapoints to derive these four key compensation trends for 2018.

Accelerated base salary growth for business and technical support roles

Overall, Singapore base salaries grew 4% in 2018, with the largest growth coming from the business and technical support roles. Looking at the overall Singapore General Industry, on average, base salaries moved 4% over last year.

But that average doesn’t really tell the full story. Breaking it down across the various career bands, we can see that base salaries for most employee categories remained stable. However, for business and technical support roles, it moved at twice the speed of the general market.

One possible reason could be due to the introduction of the Progressive Wage Model (PWM) by the Singapore Government. The PWM focuses on upskilling low-wage workers, such as cleaners and security guards, and providing a pathway for their wages to rise along with training and development. Higher base salary movements at this level will put pressure on the professional and supervisory levels over time.

2018 saw an overall salary increase of 4% from 2017, which was aligned with market projections.

Lower value placed on master’s and PhD degrees

Organisations are offering smaller starting salary premiums for entry-level employees who have a Master’s or PhD degree.

It is common for organisations to differentiate their compensation programs and pay structures based on educational qualifications, especially for entry level roles. Our data shows that graduates can expect a starting wage that is approximately 50% higher than their non-graduate counterparts.

However, candidates with a higher level of qualification – a Master’s or PhD degree – are not necessarily granted a larger premium. Graduate degree holders can expect a modest 10%-20% starting salary premium over undergraduates. As we look ahead to the future of work, employers are placing a higher importance on critical, in-demand skills than on post-graduate qualifications.

Gender pay imbalance in Singapore

If we look at the Singapore market in its entirety, there is an equal representation of males and females in the workforce – nearly 50/50. However, when we break it down by career levels, we see significant gender disparities.

At the top executive level, only 29% of incumbents are women. And on average, they are earning 17% less than their male counterparts.

Interestingly, we see a reverse gap at the business support roles – with women earning 20% more than men. This is likely due to the disproportionally large population of women in business support roles (66%).

More and more companies are taking a fresh look at their pay practices to ensure they support pay fairness and achievement of their diversity goals.

Critical skills in Singapore

Within the past five years, demand for key IT skills has increased drastically. The fastest growing jobs in terms of headcount are:

  • Data Science
  • Information Systems and Cyber Security
  • Digital Marketing

Organisations across all industries are looking to hire these critical skills and relevant experience, which will continue to drive up pay premiums and make talent acquisition more challenging.

For organisations undergoing transformation, it may not be feasible to build these skills and capabilities internally. Many will be forced to look outside for experienced talent, which may come with a high price tag.

Getting compensation right is critical to establishing the foundation of an effective total rewards strategy. Once appropriate and efficient compensation processes are in place, HR functions will be able to focus on the other key drivers of talent acquisition and retention.

For more information about our data, insights, software and solutions in Singapore, please contact Willis Towers Watson Data Services – Singapore.

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