Spotlight on Reward trends in Singapore – 2024
In our last spotlight on rewards trends installment, we spoke about the market recalibrating itself in the post-Covid19 ‘new normal’ through longer recruitment processes, more conservative salary uplifts as well as the growth of the ‘middle layers’. While these trends continue to hold sway to varying degrees during 2024, some of the latest themes include:
Slow But Steady Growth
Aside from recurring annual cyclical patterns (i.e. typically less Reward moves in Q4/Q1 as annual merit activities take centre-stage), the outlook for the Rewards job market in 2024 remains a far cry from the exceptional years of 2021 and 2022 when Human Resources (HR) and Rewards professionals were thrust in the spotlight. Such reduced activity levels can be attributed to cutbacks rooted in wider concerns around the economic climate, which places renewed emphasis on talent retention with external hires typically coming at a premium. Based on our latest market data, uplifts accrued from switching HR jobs in Singapore average 18% higher than those drawn by internal candidates or accrued through annual increments. That said, while the overall number of Rewards searches have fallen, demand still remains. The fact that Compensation and Benefits has remained buoyant is unsurprising due to its largely transferrable and specialist nature, which is in line with the observed shift towards “skills-based/first” approaches.
Ensued investment in ‘Middle Management’
The ‘middle management’ layer continues to make up the bulk of hiring needs for Total Rewards over the past ten months, which makes commercial sense as these individuals tend to bring with them a blend of strategic and operational abilities. A number of more operational roles have been offshored to lower cost locations, whereas headcounts placed in costlier locations such as Singapore would be expected to bring with them proven subject matter expertise beyond routinised tasks. For instance, the ability to perform job evaluations to assess the value of jobs within organisations, drive Rewards harmonization projects following change/transformation activities, particularly with minimal assistance from external consultants, have grown to be critical skills that differentiate talent pools within an already stratified Rewards market. Growing conversations around how Generative Artificial Intelligence (AI) tools would eventually automate certain analytical aspects of C&B in the future have arguably accelerated such an outlook.
Shifting Rewards Trends
For a large part of the year, many multinational corporates were bound by conservative hiring budgets. Such conservative approaches are also marked by a greater openness towards where new requisitions could be based. Singapore has become an obvious choice for firms that have long positioned Hong Kong as their de facto regional hub. From a sectoral perspective, markets such as Insurance witnessed a measured ascent, echoing MOM’s Labour Market Report about growing employment in that avenue. Asia-headquartered organisations, especially those from the People’s Republic of China and certain Southeast Asian nations, have continued to designate Singapore as the preferred base for expansion. To a lesser extent, select European firms are another engine that has gradually look to put down roots here to tap into alternative markets. Such inflows are reflective of the broader sentiment that Asia is witnessing new frontiers of growth, as well as the fact that Singapore specifically boasts a sizeable and diverse pool of Rewards talent relative to other markets.
The future of Rewards
In summary, we anticipate slow and steady growth in the first part of 2025, ensuing demand for ‘middle management’ layers and shifting rewards trends as the function continues to evolve. There’s a notable notion by consulting organisations such as Mercer that skills are the new currency of work, and therefore the importance of building more skills-powered organisations. This has led to increased preference for talent who can think more critically and propose bespoke pay mix solutions i.e. go beyond base salary to consider other aspects such as LTIP, and benefits among others to raise/augment overall talent attraction and retention strategies. As pay transparency practices grow more ubiquitous, work-from-home flexibility, and insurance coverage among other components (especially for firms that can’t pay top end of market) could prove to be tipping points. As with before, we echo the need to continue taking a Total Rewards approach seriously, reviewing the offering frequently in line with employee feedback as the market continues to develop.
Contact us
If you would like to discuss your personal Rewards career or your firm’s Rewards, HR Analytics, HR Systems or Payroll hiring needs, please contact myself and/or the broader Frazer Jones Southeast Asia practice today.
