Navigating Salary Trends and Employee Expectations

In today’s competitive market, understanding salary trends is essential for attracting and retaining top talent. This spotlight provides insights highlighting key trends, benchmarks, and strategies for ensuring your organisation remains competitive in the talent market, including extracts from the most recent Mercer Remuneration Report.

Key Market Insights

 Merit Increases are Higher than Forecast

Median merit base salary increase for 2024: 3.8% (highest in 10 years). 2025 projections: Slight decrease to 3.6%, still above pre-2022 trends.

This means that the median merit-based salary increase (raises typically tied to performance or merit) for 2024 was unexpectedly high at 3.8%, which is the largest increase in the last 10 years. This shows that employers have been prioritising salary adjustments to address challenges like attracting and retaining talent, as well as responding to rising costs of living.

For 2025, while the projected merit increase is slightly lower at 3.6%, it remains significantly higher than the pre-2022 average, reflecting a continued focus on offering competitive pay to stay aligned with employee expectations and market conditions.

In essence, employers are maintaining higher-than-usual salary increase budgets to remain competitive, even as inflation and turnover rates stabilise.

 Cost of Living and Inflation Impact

40% of employers are factoring inflation into salary budgets, down from 50% last year. With inflation stabilising at 2.8%, pay adjustments are shifting focus to fairness and transparency.

 Employee Priorities: Job Security & Fair Pay

Gallup data reveals 75% of employees in APAC identify job security and fair pay as the primary factors in job satisfaction.

 Trends to Watch in 2025

 Focus on Employee Well-being and Mental Health

Holistic well-being programs are essential as 70% of employees in APAC say mental health support directly influences their engagement.

 Skills-Based Hiring

Companies are moving away from degree requirements and prioritising specific skills, which widens the talent pool and boosts diversity.

 Flexible Work Arrangements

Flexible work options, including remote and hybrid models, have become a major differentiator for attracting top talent.

 Upskilling and Career Development

60% of organisations in APAC are prioritising learning and development to address skills gaps and show commitment to employee growth.

 Transparency in Pay and Fairness

Pay transparency initiatives and audits are driving trust among employees, with 68% of workers in APAC indicating that pay fairness impacts retention.

How Gallant Collective Can Help

At Gallant Collective, we support organisations in staying ahead in the talent market by offering:

• Expert advice on salary trends and pay audits.
• Recruitment as a Service, helping you attract the best talent quickly.
• Employee coaching programs to boost retention and team alignment.
• Offshore talent – build and manage your dedicated offshore team with ease, fully supported by us.

Let us be your partner in building a resilient, engaged, and high-performing workforce.