With demand for talent continuing to exceed supply at the workplace, salaries of managers in India rose 14.8% in 2007, the second highest increase in the Asia-Pacific region.
According to the eighth annual Asia-Pacific Salary Increase Survey conducted by consulting firm Hewitt Associates, Sri Lanka, with 15.3%, reported the highest increase in managerial salaries in 2007. The survey said that salaries in China rose 8.6% in 2007.
The Hewitt survey measures actual and projected salary increases across six management levels and covers 14 markets including India, Australia, China, Hong Kong, Japan, Korea and Macau.
It surveys around 1,800 foreign, locally owned, and joint-venture companies, including 262 in India.
PAYING ATTENTION (Graphic)
The first phase of the survey, results of which were released on Wednesday, measures actual compensation. The second phase measures projected compensation. Hewitt had projected a 14.5% increase in salaries in India in 2007. In 2006, according to the survey, salaries in India increased 14.4%.
Globally, according to Hewitt, the Asia Pacific region reported the highest increase in 2007, of 6.3%, followed by Latin America (5.8%) and Europe (3.8%). Overall, Venezuela reported the highest increase of 18.8%.
“The pull is on the side of the people today. With more opportunities and avenues, organizations are increasingly at the mercy of employees making a choice,” said Nishchae Suri, head of Hewitt’s talent and organization consulting analytics practice in Asia.
The increase in salaries notwithstanding, staff in Asia seem an unhappy lot. Only 46% of the employees are happy with their salaries, according to Hewitt. “A salary increase is the most perceptible way of enhancing the employment deal but, of course, not the complete deal itself,” added Suri.
Companies agree with that. “A good compensation package alone does not help,” said K.K. Swamy, deputy managing director, Toyota Kirloskar Motors Ltd. “In addition to pay, what drives and keeps employees are rewards, recognition and brand value represented by work culture, learning and growth opportunities,” headded.
Companies are also increasingly resorting to variable pay (such as incentives and bonuses) to reward and retain high-performers. Almost 92% of the companies that participated in the survey used this, according to Hewitt. “From the organization’s point of view, the need to balance burgeoning pay packets and tighten budget strings can be best addressed through a system of rewarding those who contribute towards the growth of the business,” said Janet Gasper-Chowdhury, principal consultant, PricewaterhouseCoopers, an audit and consulting firm. “In most cases, variable pay seems to be meeting the objectives of controlled pay and improving performance successfully,” added Gasper-Chowdhury.