Aon plc has released its 2025 Salary Increase and Turnover Study, projecting a 5.3% salary growth for Southeast Asia in 2026. The study, conducted between July and September 2025, analysed data from over 700 businesses across Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam. Despite the overall moderate growth, Singapore and Thailand are expected to trail behind regional peers in salary increases.
The study highlights that the life sciences and medical devices industry in Singapore is set to see a 4.6% salary increase, whilst the technology sector in Vietnam and Indonesia is projected to lead with 7.1% and 5.9% increases, respectively. In Malaysia, the consulting business and community services industry is anticipated to see a 4.8% rise.
Rahul Chawla, partner and head of Talent Solutions for Southeast Asia at Aon, noted the dual priorities for organisations: retaining top talent and managing rising compensation costs. “Balancing rising compensation costs with the need for agility is key,” he said, emphasising the importance of leveraging real-time market data and total rewards strategies.
Attrition rates remain a concern, with the Philippines and Singapore expected to have the highest turnover rates at 20% and 19.3%, respectively. The study also found that 42% of businesses face challenges in hiring or retaining employees, with skills gaps prevalent in information technology, engineering, and sales roles.
Evon Lock, head of data solutions for Southeast Asia at Aon, remarked on the cautious optimism among organisations, which plan to maintain or modestly grow their workforce despite hiring pressures. The demand for roles in sales, information technology, artificial intelligence, and cybersecurity is rising, reflecting a shift towards digital and risk-focused capabilities.
