Should You Expect A Salary Increase In 2024?

Now that we’re at the tail end of 2023, it might be safe to say that 2023 really hasn’t been the best year for Malaysians financially.

With ringgit freefalling for most of the year, inflation really made its presence felt, with most Malaysians complaining that they get less and less for their money nowadays.

And all this led to most Malaysians looking for a pay raise in 2024. But is there a realistic chance of that happening? Let’s have a look at what experts say.

65% of businesses are giving pay raises in 2024 – Robert Walters’ Survey

If you’re hoping for a salary raise in 2024, the chances of that happening is pretty massive, according to the Salary Survey Malaysia 2023, which was conducted by the Malaysian arm of Robert Walters, a recruitment group.

The survey stated that in 2024, 65% of businesses are giving pay raises in 2024, and

In a video attached to the survey, Robert Walters Malaysia’s Country Manager Ai Rene Tan said that 2024 will be a transformative year for Malaysia’s hiring landscape.

“Malaysia’s hiring landscape is poised for transformation (in 2024), with three prominent trends shaping the job market in 2024.”

“Firstly, there’s a growing emphasis on ESG (environmental, social, and governance) in various industries. With the introduction of the National Energy Transition Roadmap (NETR) which is fostering more investments, we are anticipating a surge in job opportunities in the renewable energy sector.

“Secondly, the expanding data centre industry is expected to reach RM7 billion by 2027. Buoyant employment opportunities are expected during both the construction and operational phases of these data centres.”

“Finally, many industries are undergoing digital transformation to improve operational efficiency and sharpen their competitive edge. Professionals in fintech, industrial automation, ecommerce, technology, and health informatics are in demand to fuel innovation,” she said.

Tan also said in the same video that salaries are expected to increase steadily in 2024.

“Salaries are expected to increase steadily, with some sectors and industries seeing larger spikes than others as new players to the Malaysian market vie for a limited talent pool,” said Tan.

Mercer also expects salaries to increase in 2024

Meanwhile, Mercer, a consulting firm, also reported in their Mercer’s Total Remuneration Survey that they expect a more positive salary outlook in 2024.

The survey projects an average salary increase of 5.1% in 2024, which will be welcome news for employees.

Koay Gim Soon, Mercer Malaysia Market Leader, stated that despite the more moderate economic growth in 2023, Malaysia’s labour market still showed a positive outlook.

“The country’s GDP and individual sectors have largely rebounded to pre-pandemic levels, and multiple economic indicators point towards further growth in the coming year.

“In fact, over half of the survey participants have expressed their intention to increase payroll budgets for both 2023 and 2024, which is an encouraging sign for companies and employees alike,” said Soon.

However, Soon also pointed out that while the 5.1% projected salary increase is higher than Mercer’s 5.0% forecast for 2023 and the 4.8% recorded the previous year, it is still below Asia’s average of 5.2%.

India, Vietnam and Indonesia holds the highest projected median salary increments in 2024 at 9.3%, 7.0% and 6.5% respectively.

Salary increases in 2023 overshadowed by inflation

Meanwhile ECA International, a mobility solutions provider for international workers also share its global salary survey findings. The survey found that the global outlook is starting to look more promising for employees.

They also highlight how salary increases in 2023 were a lot smaller once inflation is taken into account.

“Globally, nominal salary increases in 2023 were 5.1%, an increase of around one percentage point compared to 2022.

“However, once inflation is factored in, employees actually experienced a 1% decrease on average in real terms, meaning their buying power is now lower than it was last year,” the report shared highlighted the reality of salary increments this year.

Globally, nominal salary increases in 2023 were 5.1%, an increase of around one percentage point compared to 2022. However, once inflation is factored in, employees actually experienced a 1% decrease on average in real terms, meaning their buying power is now lower than it was last year. Although 2023 real results are disappointing, the outlook for 2024 is looking more positive.