Pay packets | malaysian pay packets set to grow by 5%-plus over next 12 months

Malaysian pay packets set to grow by 5%-plus over next 12 months

Malaysia’s executives, management, professional employees and support staff can look forward to a salary rise of 5% in 2024 for, according to a new survey.

The survey on remuneration by global advisory firm WTW found that although the projected salary increase this year was slightly lower than the 5.6% in 2023, the average salary increase has risen steadily over the past few years.

More than 600 companies participated in the Malaysia Total Compensation Survey, conducted in October 2023.

WTW said similar trends will be seen in various industries across the country this year, adding that Inflationary pressures and concerns over a tight labour market continue to be influencing factors.

“Although inflation is slowing down from the heights of recent years, Malaysia’s labour market is shifting,” said WTW head of work and rewards for Southeast Asia and Malaysia Tan Juan Jim.

Voluntary turnover and attrition reached a high of 18.5% in 2023, compared with 16.5% in 2022, and the trend looks set to continue in 2024, he said.

Tan added that employers in Malaysia will continue to face significant recruitment challenges including the attraction and retention of key talent.

They will need to balance the pay packages, both monetary and non-monetary, to remain competitive and aligned with employees’ needs and wants, he said.

WTW survey discovered that millennials and Gen Z will form more than 70% of the workforce by 2025. Industries such as banking, insurance, tech, media and gaming, as well as shared services and outsourcing, hired the most millennials and Gen Z in 2023. It said the Gen Z workforce in Malaysia grew 50% year-on-year as a percentage of total workforce since 2020.

It expects millennials and Gen Z to form more than 70% of the workforce by 2025.

Tan said: “Job security is no longer the primary focus, but understanding the emerging group of Gen Z employees becomes paramount. Organisations that provide greater work flexibility, including a choice of remote, onsite or hybrid working, will attract and retain more talent.

“This trend of working offers Gen Z more options to have multiple side hustles while maintaining their traditional economy jobs,” he added.

 

Government to focus on developing sustainability strategy

The Malaysian government is to develop a strategic plan to increase green investment and make Malaysia a major regional green investment hub and destination, according to the Ministry of Investment, Trade and Industry (MITI) minister Tengku Zafrul Abdul Aziz.

He said the goal is to achieve carbon net zero as early as 2050 in line with the New Industrial Master Plan 2030 (NIMP 2030) and the National Energy Transition Roadmap (NETR).

The National Investment Council (MPN) recently agreed to formulate a plan specifically to enhance green investment in Malaysia.

At the end of 2023, Bank Negara Malaysia’s (BNM) governor Abdul Rasheed Ghaffour said Malaysia expects to see more green and climate-change related investments in 2024 to support economic growth which is projected at between 4%–5%.

He said the government and the private sector have undertaken a number of multi-year projects that would contribute towards the nation’s economic growth from this year.

He added: “There are a number of plans that the government has already announced, one of which is related to climate change, which is the National Energy Transition Roadmap (NETR).

“There are also a lot of projects that are going to be implemented; there are 10 flagship projects and these will cover the six important levers of the green economy that will also support economic growth not just for next year [2024], but over the next three to five years,” he said at Malaysia’s Climate Finance Day in the Malaysia Pavilion at the 28th Conference of Parties (COP28).