As Malaysia’s job market continues to evolve, employees can expect better compensation in the coming year.
Salaries in Malaysia are set to rise by 5% across all industries in 2025, according to Mercer’s latest annual Total Remuneration Survey.
This increase comes as companies focus on improving compensation to meet the demands of a competitive talent market.
Projected Salary Increases Across Sectors
According to The Edge, the survey, which involved over 680 companies across various industries, including energy, shared services, technology, consumer goods, manufacturing, and more, reveals that industries such as energy and shared services are leading in base salary offerings.
These sectors are showing a strong commitment to providing competitive pay in the face of growing demand for skilled professionals.
Shifts in Job Demand and Pay Premiums
Mercer also highlights that certain roles are experiencing notable shifts in both demand and salary.
Jobs in cloud computing, electrical instrumentation, and cybersecurity architecture are seeing significant growth in salary levels due to rising demand.
Positions like project controls engineers and enterprise architects are commanding a premium as specialised skills become more valued in the competitive market.
Hiring Intentions Show Caution
Despite the salary increases, hiring intentions have weakened slightly compared to the previous year.
Only 24% of the companies surveyed plan to expand their workforce in 2025, with the majority opting to maintain current headcount levels.
This cautious approach reflects broader economic trends and companies’ efforts to maintain stability in uncertain times.
Focus on Flexibility to Retain Talent
The survey also notes that 70% of companies in Malaysia plan to adjust their remuneration strategies in 2025.
Many are shifting towards more strategic, employee-centric approaches, offering flexible work arrangements, diverse incentive structures, and tailored benefits to meet the evolving needs of their workforce.
As Mercer’s Koay Gim Soon points out, “The key is flexibility” in adapting to the changing demands of employees.
Regional Comparison of Salary Growth
The projected 5% salary increase for 2025 in Malaysia is lower than the 6.1% expected rise in Indonesia, but higher than Singapore’s 3.8% increase.
This places Malaysia in a middle ground, offering a competitive salary increase that reflects the unique dynamics of the local labour market.
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