Enterprise
Good, critical talent can fetch better wages
Behonce Beh 
Employees need to upgrade their skills to keep up with market demands
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EMPLOYEES tend to look forward to a salary increment in the beginning of the year. However, chances are they may not get any rate higher than 5%.

According to the 2017 Total Compensation Measurement (TCM) Survey study by Aon, a professional services firm, the average salary increase rate in Malaysia declined to 5% last year.

Data collected from 189 employers across Malaysia for the study showed that the healthcare, financial and telecommunications sectors continue to offer up to 5.6% salary increments, slightly higher than other sectors.

The study also reveals that the overall headcount growth within companies has remained relatively flat across all industries, with none exceeding 3%.

Following economically challenging years in 2015 and 2016, companies have adopted a more cautious approach to hiring in 2017; choosing instead to focus on improving productivity of existing employees, rather than headcount growth.

Aon Hewitt Malaysia and Philippines managing director Prashant Chadha explains that though employers are willing to pay a premium for good and critical talent, they are also focusing on employees’ key performance indicator (KPI) so that they deliver results accordingly.

You may be a fresh graduate working in a start-up, but you will find that the work you do is more impactful, say Toh

Commenting on the study, Wobb.co founder Derek Toh says recruitment activities have increased by the end of last year with the telecommunications, healthcare, professional services, financial and technology sectors being the better paying employers.

He adds those in the retail and manufacturing industry would not see much increments this year as employers in those sectors are cautious over their expenditure.

While start-ups generally pay 10% less compared to their industry counterparts, those who choose to work there are compensated beyond monetary gains such as flexible working arrangements and empowerment.

“You may be a fresh graduate working in a start-up, but you will find that the work you do is more impactful as compared to working in a large corporation with thousands of people and you are at the bottom of the food chain,” Toh points out.

Even though you are a fresh graduate working in a start-up, you find that the work that you do is more impactful than being a fresh grad working in a large corporation

Meanwhile, A Job Thing founder Ray Teng says well-funded start-ups, such as those who managed to access venture capitalist funding, are wrestling with multi-national corporations  for top talents especially those with niche or relevant skills.

More companies are adopting flexible working arrangements, says Teng

“Some companies are willing to pinch talents over by giving RM1,000 to RM2,000 extra on top of what the talent is earning now,” he comments.

Teng explains good talent are a rare commodity in the market right now. This is apparent when businesses such as shared services and customer service centres set up shop domestically.

“We do serve companies that are keen to set up call centres and shared services in Malaysia and when they do hire, they hire about 100 to 200 people at one go,” he says.

This would then create a vacuum where talents would jump to a new position when given the right remuneration package.

“When such competition happens, their existing employers will try to offer high increments or packages to convince them to say.

“Those who speak special languages such as Mandarin are in high demand and employers are willing to pay for such skill,” adds Teng.

Some jobs, even those on the lower end of the spectrum, are also enjoying a surge in demand and remuneration. The onslaught of e-commerce has increased the demand for last-mile delivery partners and riders are currently highly sought after.

“Back then, nobody wanted to be a despatch boy, who earns about RM1,000 to RM2,000 a month.

“With the likes of Lazada and UberEats becoming more popular, some players are willing to pay up to RM3,000 per rider a month!” Teng shares.

Meanwhile, family-run businesses and local corporations are also slowly open to offering higher  remuneration packages to not only attract new talent but also to maintain existing staff.

 

Low starting salary

The Aon study notes fresh graduates’ salaries are on the rise with the median salary of RM2,770.

Toh says based on Wobb.co’s data, there has been a moderate increase in fresh graduate salaries but the increase has not been significant over the last five years.

“The starting salary for fresh graduates can be somewhere between RM2,000 and RM3,000 a month,” he adds.

It is only when they switch jobs, although still at a junior level, they would enjoy a 20% to 30% increment at the new job from their starting pay.

Those seeking to move up the corporate ladder are highly encouraged to upskill themselves to meet current market demands.

“A good example would be the huge demand for talents in digital marketing compared to traditional marketing.

“Those who are able to do poster design in the past, must now be able to work on animation and graphics. There is a huge demand for talents who are able to work in an industry which is trending at the moment,” says Teng.

Attracting talent beyond huge paycheques

MONEY is not everything when it comes to attracting talent.

A Job Thing founder Ray Teng explains while most jobseekers still chase after dollars and cents, they are also considering other factors such as work life balance, flexibility and culture.

“The majority of fresh graduates will still want to join large companies, but we see also a group of people who are keen to explore start-ups owing to their flexibility and work culture,” Teng says.

He explains that flexible working arrangements is one of the biggest pull factors for start-ups, especially among younger employees and mothers.

“Companies are moving towards result-oriented as opposed to fixed hours of employment. This arrangement allows employees who are parents to take care of their family without sacrificing on work,” he adds.

Aside from start-ups, technology multinational corporations (MNCs) are offering flexible working arrangements such as working from home of flexible working hours.

Non-tangible benefits such as free catered meals like breakfast or lunch are also becoming a norm in many companies. Tangible benefits such as medical insurance and allowance offered by an employer may also attract jobseekers to work for the organisation.

Wobb.co founder Derek Toh explains while MNCs do pay better in the long run, those who chose to work in a start-up may see their careers accelerate at a much faster pace owing to a lean team and closer engagement with the founders or top management of the business.

“The quality of people working in start-ups has increased. They may be a small company but they attract high quality talent owing to the industry they are in,” he says.



This article first appeared in Focus Malaysia Issue 267.