December 5, 2024 | 12:00am
MANILA, Philippines — Most companies are planning to overhaul their compensation strategies to remain competitive in the labor market, results of a wage survey showed.
Based on the Total Remuneration Survey 2024 by Mercer, 97 percent of firms are planning to adjust their remuneration strategies next year in response to the fierce competition for talent.
The study looked at remuneration trends and policies across 2,258 roles in over 482 companies in the Philippines, which have an average of 1,000 full-time employees.
Mercer said nearly 90 percent of the organizations surveyed currently offer bonuses, while those with long-term incentives such as stock options went up to 22 percent in 2024 from 19 percent last year.
It also said companies with flexible benefits in the Philippines have increased to 19 percent this year from just 10 percent in 2018.
The study revealed that the average salary in the Philippines is expected to rise by 5.5 percent next year, slightly higher than the 5.2 percent increase posted this year.
Mercer said the salary increases for next year are influenced by the following: individual performance, salary range, firm’s competitiveness in the job market and inflation.
Apart from merit increases, companies are also allocating one percent of their payroll budget for promotions and three percent for market adjustments.
“The average salary increase of 5.5 percent in 2025 underscores the competitive landscape for talent and highlights the ongoing commitment by organizations in the Philippines to invest in their workforces,” Mercer Philippines business leader Floriza Molon said.
She said it is important for human resource leaders to look at salary adjustments, as well as short- and long-term incentives, while addressing the changing needs of employees.
“By effectively adapting to changing expectations, organizations can attract and retain top talent in an increasingly competitive landscape,” she said.
Mercer said jobs in the energy industry remain the highest-paying positions in the Philippines, offering 45 percent more in annual base salaries compared to other job families.
The energy industry also had the lowest voluntary attrition rate last year at eight percent.
On the other hand, shared services and outsourcing (SSO) had the highest attrition rate at 17 percent, which Mercer attributed to the younger workforce and available opportunities for moving up.
Mercer also said the SSO industry has the shortest average tenure, with employees staying for only three years.
In contrast, the average tenure in the consumer goods industry is nine years.
Mercer, which is part of professional services firm Marsh McLennan, is helping clients achieve investment objectives, shape the future of work and enhance health and retirement outcomes for employees.
Be the first to comment