However, a looming inflation will be a dampener as the money taken home by the employee will be less than what the increment states. In that case, China tops the list with a real salary increase of 5.2% after allowing for inflation, with Pakistan (4.5%), Bangladesh (4.3%), Vietnam (4.1%) and Sri Lanka (3.8%) trailing. India drops down two places to No. 6 with a corresponding real increase of 3.5%. Japan, with a 0.6% raise, will see the smallest increase.
“We foresee an increased economic growth in Asia Pacific in 2015 in light of a declining unemployment rate and rising GDP in the region. This, in turn, will lead to inflationary pressures that affect real salary increases. Indians will only see an effective salary increase that is one-third of the overall salary increase due to such pressures,” says Sambhav Rakyan, data services practice leader, Asia Pacific at Towers Watson.
The report also stated that increments will either be equal or higher than last year in percentage terms. The only exception will be for employees in Taiwan, where the rate of increase will dip from 2.8% to 1.7% after inflation.
Employees in the pharma sector will get the highest increase while those in financial industry in India will get a modest 10% raise, similar to last year. “Compensation in financial institutions has become a major concern for governments and the general public as a consequence of the recent global financial crises,” says Rakyan.
Those employed by the IT industry will get a raise of 10.7% compared with 10.5% in same period last year.
Source: The Economic Times