Mercer’s Total Remuneration Survey projects slightly higher salaries for employees in Thailand despite looming downturn
- Median merit salary increments expected to increase to 5% in 2024, up from 4.8% in 2023
- Life Sciences, High Tech, and Automotive industries are projected to have the highest merit increases
- Voluntary attrition rate shows an upward trend which implies a loosening of the labor market across industries
Thailand, 13 November 2023 – Mercer’s Total Remuneration Survey (TRS) 2023 has revealed that employees in Thailand can expect higher salaries in 2024. The TRS surveyed 617 organizations across seven industries in Thailand between April and June this year. The projected median merit salary increment for next year is 5%, up from 4.8% in 2023.
Juckchai Boonyawat, President of Mercer Thailand, said: “Due to the robust recovery of domestic demand and the tourism sector, increased foreign direct investments, and stimulus policies from the new government, we expect a more positive economic landscape in Thailand for 2024. Continued growth will be gradual and stable.”
Thailand’s projected median salary increment of 5% 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% respectively. Other countries included in the survey are the Philippines at 5.7%, China at 5.2%, Malaysia at 5.1%, South Korea at 4.4% and Singapore at 4.2%.
Life Sciences, High Tech and Automotive industries project highest merit salary increases in Thailand
Merit salary increments are expected to rise across most industries, with the Life Sciences, High Tech and Automotive industries expecting to see the highest increases at 5% in 2024. The latter industry, for example, is expanding with more electric vehicles in the market and increased competition amongst automotive companies, giving rise to a higher demand for talent. Most of the industries are also projecting higher increases as compared to previous years, and the Life Insurance industry is the only sector that has projected a decrease of 4% from 4.2% in 2023.
Performance recognition is key for industries like High Tech, Life Sciences and Consumer Goods, as evident in their variable bonus payouts. At 68%, 61%, and 52% respectively, they have the biggest differences in payouts between employees who have met their target performance indicators and those who delivered outstanding performance (see Figure 1).
Variable bonus payout by industry
Figure 1: 2023 Thailand Total Remuneration Survey – Variable Bonus
Higher voluntary attrition rate implies a loosening of Thailand’s labor market
Since 2020, Thailand’s voluntary attrition rate has been steadily increasing to 10% in 2023. Juckchai added: “With economic recovery underway in Thailand, companies are making investments to expand and seize new business opportunities. This has resulted in renewed demand for skilled talent. We have also observed that an ageing society has caused a leadership gap in firms, hence they see the need to embark on talent-buying strategies to address talent shortages.”
Derek Heng, CEO of Marsh McLennan Thailand, said: “Despite signs of loosening in the labor market, Thailand’s unemployment rate stands at 1.2% in the first half of 2023, which is one of the lowest in Southeast Asia and even globally. This demonstrates that employees here are actively seeking employment opportunities that will set them up for future career growth and better salary prospects. Hence, the ability to offer well-thought-out remuneration packages will be critical for employers and HR leaders to attract and retain valuable talent, especially in sectors that require specialized skillsets like High Tech and Life Sciences.”
About Mercer’s Total Remuneration Survey
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 Thailand 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 X.