The global spread of Coronavirus has already had its toll on many sectors of the economy, with tourism and hospitality among the hardest hit industries. Soaring unemployment due to massive labour cuts was also accompanied by declining wages. The weakening economy during pandemic has made wage growth decelerated inevitably, prompting employers to adjust their compensation plans for this year and beyond.
With companies might find it their budget tight for salary increments, what can leaders to remain attractive to talents? In this occasion, HR in Asia sits with Kulapalee Tobing, Career Products Leader for Mercer Singapore to discuss holistic view to engage employees during the pandemic. Stay tune!
Question: Ms. Tobing, thank you for devoting your time for this interview. After months of dealing with the pandemic, its repercussions are still being felt by all sectors of society. In your opinion, how long businesses have to stay in ‘survival mode’?
Answer: Although there are positive signs for the global economy with the development of several COVID-19 vaccines, the future remains shrouded in uncertainty for businesses.
For many, a ‘wait and see’ approach remains the norm as they eagerly await the successful rollout of vaccines. However, businesses cannot afford to sit on their laurels. Business leaders will need to stay agile and adapt quickly to ensure their businesses are poised to act when the economy rebounds.
Areas that businesses can consider reshaping during this time is how they are engaging with employees. For example, they can rethink remuneration structures, benefits, and incentives, as well as helping employees find an appropriate balance between work and life so they remain energized through this challenging period.
Question: Mercer’s latest report suggested that some employers will implement salary freezes and even reductions in response to the current situation. How will this affect an organisation’s employee retention?
Answer: Monetary rewards remain a key drawcard for attracting and retaining talent; however it is only one of many levers that businesses can pull.
To boost employee retention, businesses need to take a more holistic approach and consider the other drivers of employee engagement. Leveraging insights gathered through employee surveys or focus groups, businesses will be able to cater to the different workforce segments and assign values to their contribution to the overall success of their business.
In doing so, businesses will be better placed to tailor a compelling value proposition for their employees that balances monetary rewards with other drivers such as career development opportunities and culture.
Question: Organisations might not be able to offer much in terms of salary increments this year. So, what’s the best alternatives they can offer to keep attracting top talents?
Answer:Many businesses are taking a holistic approach to redesigning the work experience to attract and retain talent, including to provide additional incentives and benefits.
Mercer’s TRS revealed that next year, 30 percent of employers are looking to add or expand telemedicine or digital care to their health programs to respond to the acceleration of digital health usage. Half of employers (50%) are also looking to provide reimbursements for expenses incurred by employees who are working remotely, such as internet service, laptops and mobile phones.
In the short term, businesses are also reviewing policies around annual leave, including to allow employees to carry forward or encash their unused annual leave.
Mercer has also observed innovative practices to engage employees. For example, Apple and Microsoft have extended paid leave for parents with children in countries with school closures, Starbucks, OCBC and DBS have implemented a no lay-off policy, and Citibank is offering employees and dependents free COVID-19 insurance.
Question: Not all industries have been affected the same, some are crashing while others are holding steady or even seeing a surge in demand. Does this mean that wage growth among industries tends to vary as well?
Answer:The projected increments on wage growth will vary across industries in 2021. The Banking & Finance and High-Tech sectors will remain stable while the Logistics and Consumer Goods industries will see incremental growth (3.3% and 3.5% respectively compared to 3.1% and 3.4% in 2020).
The Life Sciences, Real Estate, Chemicals, and Lifestyle Retail industries can expect to see a dip in increments as they bear the brunt of the COVID-19 fall out. Lifestyle Retail will see the sharpest dip from 3.3 percent in 2020 to 2.9 percent in 2021.
These projections correlate with shifts in consumer spending behaviours. As consumers turn to digital, there are greater opportunities for growth in the Logistics and Consumer Goods industries while lower discretionary spending capacities and reduced leisure activities will impact the Lifestyle Retail industry.
Question: Across occupations, what roles will be seeing the highest pay rise? Based on your observation, what’s the factors behind that trend?
Answer:Many businesses in Singapore are accelerating their digitalization efforts in a bid to optimise their products and processes. This is driving strong demand for roles supporting business transformation and digitalization.
As a result, the competition for digital talent, fulfilling business-critical roles, is high and such roles command pay premiums, especially for those at senior or specialist levels. For example, specialists with capabilities in cybersecurity incident response analysis and robotic process automation are expected to receive a 33 percent and 30 percent premium respectively on the median annual base salary.
Question: Mercer’s survey also found the pandemic has accelerated digitalization across all Singapore businesses. The current digital talent race, does it affect wage growth in the industry, too?
Answer:What we have seen from Mercer’s TRS results and pulse surveys is that companies will focus on allocating their salary budgets to critical talent: high performers and specific skill sets. Digital talent falls into the latter and it is likely that while wages for most average performers will stagnate, digital talent will likely see bigger increments compared to other functions.
Question: Can you share some tips on how leaders can take a holistic view to redesign the work experience for employees? What key points should be highlighted in this process?
Answer:Affordability is the main consideration for business leaders when redesigning the work experience for employees. This must be balanced against alternate benefits and incentives to engage their workforces. According to Mercer’s Global Talent Trends Survey, energized employees are twice as likely to be excited about the prospect of reskilling and three times more likely to be satisfied with their company, with no plans to leave.
A strong and positive employee experience means an energised workforce. Supporting the workforce mentally, physically and financially is critical as is communication and monitoring of employee experience (for signs of burnout, for example). Access to benefits programs, digital tools, online learning and reskilling are all key to building a work experience and value proposition that will bring out the best in their people. Helping employees manage their work-life balance is also one of the top things companies can do to help them thrive at work.
About Kulapalee Tobing
Kulapalee is the Information Solutions Business Leader within Mercer’s Career Solutions in Singapore and Indochina. She is also a Chemical Industry Survey Leader for Asia Pacific.
Kulapalee has over 20 years of experience with Mercer and has worked with leading local and multinational organizations across various industries. She has extensive experience conducting position evaluation interviews using Mercer’s evaluation system and has been responsible for implementation of the system across various organizations. Her previous role was ASEAN Information Solutions Business Leader, managing the overall Talent Information Solutions business in ASEAN. Prior to her posting in Singapore, Kulapalee was leading the Information Solutions team in Indonesia.
Kulapalee has a master’s degree in international affairs from Ohio University and a second upper honors degree from Chulalongkorn University.
Connect with Kulapalee here.
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