Jan 9, 2010

Pay rise likely for finance workers: Poll

Over 60% of HR execs expect hike; key reason is to attract and retain staff

FINANCIAL industry workers look like they will be in for a pay rise over the next 12 months, according to a new survey.

It found that 62.4 per cent of human resource (HR) professionals in the industry expect basic salaries within their firms to increase over the year.

The main reason is the need to attract and retain key staff as the economy improves, said recruitment company Morgan McKinley, which conducted the telephone-based survey.

The firm, which opened its Singapore office on Thursday, polled 134 senior operational and HR managers in financial services, commerce and industry from September to October last year.

Managing director Jeremy Canning said in the survey report that the results suggest confidence is returning, so ‘employers are prepared to reward in line with the market improving’.

However, 32.5 per cent of respondents expect salaries to remain unchanged due to a focus on cost management, while 5.2 per cent said pay would decrease.

The survey found that 70.1 per cent expect bonuses to be paid, with 51.5 per cent of that group saying the payouts will be similar to, or higher than, the 2008 increments.

In the light of the controversy surrounding huge bonus payouts to financial sector employees, the respondents were also asked if they had restructured compensation packages in their businesses.

Only 19.5 per cent had made some changes, but 80.6 per cent said no changes had been made or that they were not aware of any.

‘It seems much of the coverage and talk of reducing excessive bonuses is not translating into reality in terms of restructured packages,’ noted Mr Canning.

‘Organisations may still need to factor in sentiment surrounding high-risk, short-term strategies and how reward is adjusted against this type of behaviour.’

Overall, banking operation divisions here have started to see a slow but steady recovery in hiring over the last few months of last year.

More than 90 per cent of those surveyed plan to definitely or maybe hire new staff in the next six to 12 months.

The real test will be to see headcount allocation for new hires this month, said Mr Canning.

‘The findings suggest the hiring market is at a crossroads; for many senior managers, growth and optimism are on the cards going into 2010.’

However, this is also tempered with a strong desire by management to maintain and challenge costs, he said.

As expected, any recovery will be more of a gradual improvement rather than a sudden increase, he added.