Global wage increases strongest in Asian economies
Globally for 2019 real wages are forecast to rise fastest in Asian economies. UK salary increases are expected to double depending on the impacts of Brexit.
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Global variations in wage increases
- In Europe the average salary increase is expect to be 0.8%, supported by low inflation. Ukraine is the only European country expected to be in the top 10 globally for 2019. In Ukraine nominal salary increases are large at around 10%, however so are inflation rates. The projected 2.7% increase for 2019 is a turnaround from 2018 where high inflation drove a -0.9% decrease.
- Asia nations lead with nine of the ten highest wage increases. According to Kilfedder, Production Manager at ECO International, the real salary increases are driven by rising productivity and low inflation in many Asian economies.
- In the United States real wages are expected to rise only marginally higher than the UK (0.9%).
- The situation in Latin America varies considerably. Peru benefits from low inflation making a salary increase of 2.5% whilst Argentina sits at the bottom of the ECA’s table.
- In Argentina ICA forecasts a -8.7% decrease in real salaries in 2018, an improvement on the -11.6% decrease in 2018. President Macri’s policies have failed to reverse longstanding economic troubles, as a result Argentina required an International Monetary Fund (IMF) bailout of over USD 56bn. The associated inflation rate is exceptionally high at 31.7%, driving the decrease in real salaries.
- Egypt, Nigeria and Turkey are amongst the highest globally for nominal pay increases however high levels of inflation will result in real pay decreases of -1%, -3.2%% and -6.7% respectively.
- In the Middle East an ease in inflation rates means salaries in Saudi Arabia and United Arab Emirates are set to reverse the 2018 negative trends with real salary increases of 2.0% and 2.1% respectively.
Countries | Global Ranking | Real salary increase 2019 (%) |
India | 1 | 5.1 |
Vietnam | 2 | 4.9 |
Indonesia | 3 | 4.2 |
China | 4 | 4.1 |
Thailand | 4 | 4.1 |
Bangladesh | 6 | 3.9 |
Cambodia | 7 | 3.4 |
Sri Lanka | 8 | 3.2 |
Korea Republic | 9 | 2.7 |
Malaysia | 9 | 2.7 |
Ukraine | 9 | 2.7 |
Countries | Global Ranking | Real salary increase 2019 (%) |
Ukraine | 1 | 2.7 |
Russia | 2 | 2.3 |
Romania | 3 | 1.8 |
Bulgaria | 4 | 1.7 |
Irish Republic | 5 | 1.3 |
Serbia | 6 | 1.2 |
Germany | 7 | 1.1 |
Italy | 7 | 1.1 |
Netherlands | 9 | 1.0 |
Norway | 9 | 1.0 |
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