According to the HR Pulse Survey report by global consulting firm Watson Wyatt, Malaysian companies are budgeting for an average salary increase of 3.9% in 2009, down from 6.2% forecasted in November last year. A descending trend in average performance-linked bonus of 1.9 months is also projected for 2009, down from 2.5 months actual payout in 2008. The survey covers 86 companies from sectors including automotive, banking, construction/ property development, consumer products/ trading to insurance and shared services & outsourcing (SSO). Data was collected from 18 February 2009 to 19 March 2009.
“Salary increase budgets will mirror the economic environment and therefore we can expect a further decrease in the budget numbers if economic indicators continue to worsen,” Vivek Nath, Managing Director, Watson Wyatt Malaysia said,
The survey indicates that 33% of companies have introduced a retrenchment or voluntary separation scheme (VSS) in the past three years and a further 20% of companies are considering a retrenchment or VSS exercise in the next 12 months. Some of the popular cost cutting measures that have been taken or to be taken within the next 12 months include hiring freeze, increasing restrictions to company travel policies, downgrading or cancelling company holiday or staff social events. Almost three quarters (71%) of the companies surveyed are already in a hiring freeze mode or planned to do so this year.
“We do expect to see a downward trend in hiring rates in Malaysia. We believe that organisations will continue to fill in critical roles, albeit selectively;” said Vivek. “This is a good time to make strategic and / or critical skill hires that have been hard to come by in the last few years. Organizations that are taking a longer-term view despite the current environment will be looking at making these strategic talent acquisitions.”