Mercer’s Total Remuneration Survey reveals positive salary outlook for Malaysia in 2024 despite economic cooling 

• Median salary increases show a consistent uptrend, rising from 4.8% to 5.0% in 2022-2023 and projected to reach 5.1% in 2024
• Energy and High-Tech industries lead salary growth, with increases of 6.5% and 6.1% respectively in 2023
• Consistent market forecast for bonus payouts with a median of 2.2 months across all industries in 2023

KUALA LUMPUR, 24 NOVEMBER 2023 – Mercer's Total Remuneration Survey 2023 brings encouraging news for employees in Malaysia, projecting an average salary increase of 5.1% for 2024. The survey, conducted between April and June this year, collected data from 668 multinational corporations (MNCs) across 15 industries in Malaysia. This projected increase is a slight uptick from Mercer’s 5.0% forecast for 2023 and the 4.8% recorded the previous year, indicating a positive trend in salary growth.

Koay Gim Soon, Mercer Malaysia Market Leader, said, “Despite the moderate economic growth experienced in 2023 compared to the previous year, Malaysia's labor market continues to show a positive outlook, which is reflected in the uptrend in salaries. The country's GDP and individual sectors have largely rebounded to pre-pandemic levels, and multiple economic indicators point towards further growth in the coming year. In fact, over half of the survey participants have expressed their intention to increase payroll budgets for both 2023 and 2024, which is an encouraging sign for companies and employees alike.”

Malaysia’s projected median salary increment of 5.1% in 2024 falls slightly below the Asia average of 5.2%. This reflects the varying pay progression between emerging and developed economies in the region. India, Vietnam and Indonesia report the highest projected median salary increments in 2024 at 9.3%, 7.0% and 6.5% respectively, while Japan, Taiwan, and Hong Kong report the lowest at 2.6%, 3.8% and 3.9%. Other countries included in the survey are the Philippines at 5.7%, China at 5.2%, Thailand at 4.7%, South Korea at 4.4% and Singapore at 4.2%.

In 2023, the Energy and High-Tech industries have led salary increases in Malaysia, with median salary growth of 6.5% and 6.1% respectively. Sectors such as Consumer Goods and Manufacturing have seen a salary increment of 5.0%, similar to the Malaysia-wide median. However, the Life Sciences industry, which recorded the highest salary increase in 2022 at 7.7%, experienced a decrease to 4.3% in 2023. The Transportation Equipment sector has seen the lowest increase at 3.6% for 2023. These industry trends are projected to continue in 2024, with the industry-wide salary increase forecast averaging at 5.0%.

Koay explained, “Energy has consistently been one of the leading sectors for salary increases, driven by outstanding financial results due to the 2022 global energy crisis caused by supply chain disruption as well as the growing emphasis on renewable energy. In 2022, major players within the Energy industry earned record profits, and have since reinvested a portion of their income growth into improving their compensation strategies to attract and retain top talent. As for the High-Tech industry, its salary increase is largely driven by the surge in demand for digital and technology skills like Big Data and Artificial Intelligence in Malaysia.”

Source: Mercer’s Malaysia Total Remuneration Survey 2023

The survey revealed consistent median values for 2023 bonus projections across industries in Malaysia, with an average multiple of 2.2 times the monthly base salary. While the Shared Service & Outsourcing sector maintained the highest bonus projection at 2.4 months, the Retail industry is expected to see a notable decrease from 2.5 months in 2022 to 1.5 months in 2023. This adjustment reflects a return to pre-pandemic bonus levels after Retail companies provided higher-than-normal bonuses in 2022 due to post-pandemic recovery. On the other hand, the High-Tech sector reported a significant increase in bonus projections, rising to 2.2 months in 2023 from 1.8 months in 2022.

Sean Chou, CEO of Marsh McLennan Malaysia, emphasized the importance of strategic talent management and retention strategies in light of the positive salary outlook. “The findings of Mercer’s Total Remuneration Survey 2023 provide valuable insights for HR professionals and business leaders as they plan their 2024 workforce strategies. We encourage them to prioritize competitive compensation packages, emphasize career development opportunities, and foster a supportive work culture to attract and retain their top talent. By investing in their workforce, companies can position themselves for success in the evolving market landscape and drive sustainable growth,” he said.

The Total Remuneration Survey, Mercer’s flagship annual compensation and benefits benchmarking study, identifies current pay practices and benefits policies, as well as budget, hiring and turnover trends for the year ahead. In addition, Mercer also conducts regular pulse surveys throughout the year to keep up with the impact of the rapidly changing business environment and compensation and workforce trends.

For more data and insights from Mercer’s Total Remuneration Survey 2023, please see here.

Mercer believes in building brighter futures by redefining the world of work, reshaping retirement and investment outcomes, and unlocking real health and well-being. Mercer’s approximately 25,000 employees are based in 43 countries and the firm operates in 130 countries. Mercer is a business of Marsh McLennan (NYSE: MMC), the world’s leading professional services firm in the areas of risk, strategy and people, with more than 85,000 colleagues and annual revenue of over $20 billion. Through its market-leading businesses including Marsh, Guy Carpenter and Oliver Wyman, Marsh McLennan helps clients navigate an increasingly dynamic and complex environment. For more information, visit mercer.com. Follow Mercer on LinkedIn and Twitter.