Vol. VII No. 7 - Tuesday
February 12, - February 18, 2008



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by Saichon Paewsoongnern


BUSINESS & TRAVEL
HEADLINES [click on headline to view story]:

Asian salary increases well above global average according to survey

Thai travel agents act to minimize threats to business

Skål Bangkok invites members to special luncheon meeting

Asian salary increases well above global average according to survey

Asian workers are to continue receiving the highest salary increases worldwide, according to the ECA International’s Salary Trends Survey 2007/2008, with average figures for the region forecast to be 7.3%, well above the global average of 5.9%.
ECA’s survey contains information collected from multinational companies about actual salary increases for 2007 and predicted salary increases for 2008. Including data analysis in the context of economic conditions, the survey is used by international companies to monitor and benchmark company salary levels in local markets around the world.
Singapore’s workers can expect salary increases of 5%. While this increase is below the regional average, this is up on last year’s 4.5% increase – reflecting a longstanding trend of rising salary increases in the country.
“For a developed economy country such as Singapore this level of wage increase is high. Most other developed economies in our survey are showing forecast wage increases of approximately 4%,” states Lee Quane, General Manager of ECA International. “This can be explained partly by Singapore’s robust economic growth in 2007 and partly by the fact that companies are facing a relatively tight labour market, which looking into 2008 shows little sign of changing.”
In Hong Kong, despite a strong economy and tight labour force, salary increases are expected to remain at 4% - the same as in the previous two years. This is the second lowest rate in the region and 3.3 percentage points below the regional average.
China’s salary increases are anticipated to remain static at 8%.
“While workers in China and Singapore receive lower salaries than their Hong Kong counterparts, the fact that they will be enjoying significantly higher salary increases means that the salary gap between these locations will continue to narrow,” explains Quane.
The Philippines is forecast to join India, Indonesia, Vietnam and China in 2008 as the fifth Asian country in the top ten seeing the largest salary increases in the survey. Salary increases in the region are predicted to be over 25% higher than they were in 2005 and for the first time the region’s salary increases are expected to overtake those of Eastern Europe where wage rises are showing signs of starting to stabilise.
Regionally, India and Vietnam are expected to see the biggest increases when compared to last year’s salary rises. In India the 14% salary rise is significantly up on last year’s highs of 12.6%, while Vietnam’s 10% prediction shows a notable increase on the 8.5% salary increments given in 2007.
Japan is expected to experience the region’s lowest salary increases again this year. They are forecast to remain at 3% - the same as in 2007.
Rising inflation
Within the region, real wage increases - the difference between actual salary increases and inflation – have shown a rising trend in recent years. However, unexpectedly fast inflation growth over the past three months prompted by significant rises in oil, food and accommodation costs, will counter-balance many of these high salary increases considerably. Most locations in Asia will therefore see lower rates of real wage increases than in 2007.
“This latest upswing in inflation, which has caught many people by surprise, will have an impact on real salary increases in 2008,” says Quane. “When many companies calculated salary increases for 2008, inflation forecasts were relatively low. Inflation in Singapore, for example, is now around two and a half times higher than anticipated in October forecasts, so employees here are likely to experience relatively subdued real income rises in comparison to previous years. The same goes for major economies such as China, Korea and Taiwan.”
“The combination of lower real wage increases, together with a relatively tight labour market in many Asian economies, will become a headache for companies seeking to attract and retain talented staff in 2008.” Quane adds. “Companies will need to consider revising their forecast salary increases during 2008 or provide higher salary increases next year to make up for this year’s relatively low increase in real incomes.”
Overview
Globally, Indian workers will again receive the largest salary increases in 2008, which are anticipated to be 14%. India is followed by Argentina (12.7%), Indonesia (11.3%) and Russia (11%). These high increments are mainly the result of fast economic growth and widespread skills shortages, which are prompting companies to pay more for talent while keeping pace with the inevitable inflation that comes with economic development.
At the other end of the scale, companies are forecasting that workers in Switzerland, Japan, France Austria and Germany will be receiving the lowest salary increases this year.
Elsewhere, the UAE is expected to see the biggest improvement on last year, according to the survey, with salary increases forecast to be 8.7% – a whole 1.7 percentage points above last year’s rate. As this part of the world continues to experience robust growth, other countries in the region are also likely to record relatively high salary increases.
The biggest fall in salary increases since last year is forecast for Slovakia. Companies there are predicting wage increases of 5.5%, down 1.3% percentage points on last year.
Although salary increases in Eastern Europe are showing signs of stabilising, wage growth remains relatively high there, with a regional average of 7%. Western Europe continues to be the region with the lowest expected salary increases, averaging 3.9% - almost 50% lower than increases forecast for Asia.
In Latin America, companies in Argentina are forecasting salary increases to rise from 11.3% in 2007 to 12.7% in 2008. This is almost double the regional average of 6.4%. (Source ECA International)


Thai travel agents act to minimize threats to business

2008 predicted to be difficult year

The Association of Thai Travel Agents and the Thai Hotels Association have predicted another difficult year for the Thai tourism industry, and hope that the new government will come up with a clear policy to keep the industry afloat. The Thai Prime Minister was expected to name the Cabinet’s appointed tourism and sports minister this week. Both associations plan to meet with the new minister and seek his or her support in tourism policy and marketing. The THA president, Chanin Donavanik, said that the global economic slowdown, rising oil prices and the constant negative press coverage on Suvarnabhumi Airport are factors threatening growth in the Thai tourism industry.
He added that Thai hotels will face more competition when about 30,000 new rooms in higher category hotels come online nationwide by 2010. About 12,000 new rooms are expected to open this year. In view of these challenges, both Chanin and the ATTA president, Apichart Sankary, urged member hotels, inbound agents and tour operators to step up their marketing efforts. “The hotel industry will have to work harder this year, but I hope we will able to wade through all the problems,” Chanin said.


Skål Bangkok invites members to special luncheon meeting

Presidential chain to be given to the new President

Skål International Thailand is holding a very special luncheon meeting for all its members on Tuesday, February 12 at the China Room II, on the 4th floor of the Imperial Queen’s Park Hotel, Bangkok. The purpose of the meeting is to enable members to witness the handover of the Presidential chain from the past President, Mr. Brian Sinclair Thomson, to the new incoming President Mr. Andrew Wood. There will also be a keynote speech from Natwut Amornvivat, the new President of the Thailand Convention and Exhibition Bureau, which will be his first major address to the tourist industry.
The meeting will begin with a “welcome” drink at 12.00 noon; lunch will be served from 12.30 p.m., followed by the address by the guest speaker.



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