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Macau – Pay to rise as much as +10% in 2014

06 January 2014

Salaries paid by big employers, particularly casinos, are expected to increase by between +5% and +10% in 2014 as the supply of labour remains tight, reports the Macau Business Daily. With one of the lowest unemployment rates in the world (1.9%), Macau’s small and medium sized enterprises are expected to struggle to retain their employees.  

Jiji Tu, Managing Director of MSS Recruitment Ltd, said the increase could serve as an indicator for employers in other industries: “They will take the rate offered by gaming companies as a reference, as workers in the gaming industry account for a big part of the city’s labour force. And the increase is close to the inflation rate, which is similar to the pay increase last year.”

Jennifer Liao, Managing Director of EvolutionHR Consultancy Ltd, believes that employers are unlikely to freeze pay: “Because of the strong demand for labour in the market, employers have to keep the pay they offer at a competitive level to hold on to workers.” In Ms Liao’s opinion, this year’s pay rises will be similar to last year’s; between +5% and +10%, in line with inflation.

Ms Tu added that some SME’s might have to increase pay by more than the average to retain staff if their pay rates were low.

The vice-chairman of the Macau Small and Medium Enterprises Association, Daniel Iong Ieng, said pay increases were almost certain as employers tried to hang onto their employees. “It is not a matter of whether there will be a pay increase, but of how much the increase should be. Many of our members have said they cannot retain their staff even if they raise pay twice a year. They think working for the gaming companies will be less exhausting and earn them higher pay.”

Mr Iong predicts that SME’s will increase salaries by between +5% and +7% this year, like they did last year.

Official data show the average earnings of gaming employees were MOP 18,900 (USD 2,300) last June, making them the highest-paid workers in Macau.

Mr Iong said SMEs could not incessantly increase pay in their efforts to retain their staff. He urged the government to make the labour market ‘more open’ by relaxing restrictions on taking on migrant workers. He said about 30% of the members of his association had closed because they were short-staffed and faced difficulty in operating.

A survey commissioned by the SME association last year found that 90% of SMEs would start making losses if their labour costs rose by another +20%. Researchers surveyed over 540 enterprises, most of them with fewer than 100 employees.

Legislative Assembly member Song Pek Kei said in a written inquiry that the government should consider relaxing the restrictions on hiring migrant workers by lowering the minimum number of Macau residents a company must employ before it is eligible for a labour import quota.

Ms Tu thinks SME’s have one advantage over big employers in their struggle for labour, even though they pay less. “Some residents do not opt for gaming companies as they think human relationships there are complicated. As long as SME’s can provide a good workplace, a company culture with close ties among colleagues and bosses, they will have appeal, as Macau people put emphasis on a happy workplace.”

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