Consumer-Products, Oil-and-Gas Firms Most Generous

By Post Reporters, Bangkok Post, Thailand

Dec. 2–Salary increases for 2005 are expected to average 6.4 percent, with an average total bonus of 2.6 months’ salary, according to the human resources consultancy Hay Group.

Companies in the consumer-products and oil-and-gas sector lead the market with average base salary increases of 7 percent, followed by manufacturing at 6.5 percent. The annual study is based on a survey of various industries between September 2004 and August 2005.

Anuchit Veerasiriyanon, the reward information business manager for Hay Group Thailand, said similar salary increases would be expected in 2006 as sustained economic growth of around 5.2 percent would lead to a demand for more professional skills.

“Salary and bonus increases must be seen in the context of consumer price increases that will average 4.5 percent in 2005,” he said.

“This figure is expected to drop to around 4 percent in 2006. The Thai economy is currently highly competitive for employees with three to five years of work experience, and it is likely to stay this way for some time.”

The insurance sector showed the lowest average increases among industries surveyed at 5.4 percent, followed by retailing at 5.6 percent.

For senior executives, banks offer the highest compensation levels, with total remuneration 69 percent higher than the average. Among non-executives, the oil and gas sector offered the highest total pay, at 52 percent higher than the survey average.

The average fixed bonuses for all management levels under the survey was 1.3 months.

Variable bonuses averaged 2.2 months and total bonuses averaged 2.6 months’ salary.

For 2006, the Hay Group predicts that the average base salary increase in Thailand will be led by the consumer products and oil and gas sectors with a rise of around 7 percent expected. The retail and insurance sectors will continue to lag with the average pay increase likely to be 5.5 percent.

Hay predicts the average total bonus in 2006 will remain steady at 2.6 months of salary.

“Companies seeking to retain key managers and executives will remain under pressure to reward senior staff accordingly. If they don’t, corporations run the risk of losing productive executives who can land on their feet elsewhere,” Mr Anuchit said.

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