Salary hikes to stay ahead of inflation in 2017, 2018: survey

Speaking at the announcement of Talentnet-Mercer Post survey in HCM City on October 6, Hoa Nguyen, senior director of Talentnet, said though 4.9 percent inflation was forecast for this year, multinational and local companies had offered employees salary increases respectively of 8.5 percent and 8.9 percent.

Talking about pay hikes by industry, she said technology, life sciences and chemicals were the top three sectors in increasing salaries, with their hikes at 9-10 percent.

At the other end of the spectrum were education, financial services-banking and oil and mining with 7 percent, 5.7 percent and 4.6 percent hikes.

With a better forecast for business growth in 2017-18, companies plan for a higher variable bonus payout compared to last year.

Agriculture, banking and finance topped the variable bonus list with payouts of 22.1 percent, 20.7 percent and 20.7 percent.

Leading local companies continued to pay higher variable bonus (22.1 percent) rates than multinationals (16.6 percent).

But the average salary paid by local companies is 29 percent lower, and the difference widens from 15 percent (para-professional) to 30 percent (professional) and 41 percent (management), according to Hoa.

On the other hand, local companies are willing to be flexible to compete with multinational companies for key talents.

According to the survey, the average voluntary staff turnover rate of local companies is higher than multinationals’(10.5 percent compared with 7.4 percent).

The highest turnover rates for multinationals by industry were retail (32.2 percent), real estate (18.8 percent), and consumer goods (17.3 percent) while chemicals and oil and mining had low rates of 9.9 percent and 5.3 percent.

Sales and marketing continue to be the hottest jobs while there is a short supply of engineering professionals that recruiters are struggling with.

A total of 592 established multinational and local companies with more than 289,200 employees in 16 industries took part in the survey, considered the largest and most comprehensive in Vietnam.