Hong Kong’s workforce is expected to see a growth of 4.3% in their salaries in 2017 according to the Aon Hewitt 2016 Total Compensation Measurement (TCM) Study.

The report states that graduates entering the job market in 2017 can expect to earn a projected 4.3% more than those who entered the market in 2016. Those taking up entry level jobs in sales and marketing can expect a higher salary compared to administration and accounting, indicating a shortage of skills in these functions.  Meanwhile, a 4.8% salary increase is projected for construction / engineering.

Professional services will see the biggest jump in salaries from 4% in 2016 to 4.5% in 2017. Moreover, the transportation sector will see a lower salary increase rate from 3.5% to 3.2%, triggered by the oil and gas crisis.

A stable employment market, higher attrition and increase in salaries projected to make it difficult for Hong Kong employers to attract and retain talent. The unemployment rate in Hong Kong remains stable with a seasonally adjusted unemployment rate at 3.4% in July-September 2016. However, this has led to a rise in voluntary turnover and higher employee attrition of 15% in June 2015-July 2016 period vs. 12.6% a year earlier.

"An increase in voluntary turnover amidst a stable job market signals that employees continue to explore better external opportunities and have high demands from their employers,” Gary Chin, Aon Hewitt Rewards Practice Lead, said. “Apart from meeting the talent's needs and expectations, companies face the challenge to devise innovative people policies and programmes to differentiate themselves from competitors in the market and shape a positive employee experience, in order to sufficiently attract and retain critical talent. When such differentiators are in place, it is also important for organisations to clearly communicate them across the board, as employee understanding can essentially help foster a sense of adequacy and further enhance engagement."

“The total attrition rate of 17.7% and rise in voluntary resignation cautions companies to work harder to engage and retain their existing pool of talent. At 26.9%, the services industry has the highest attrition rate and retail employers will find it difficult to retain their talent,” Chin said.