SINGAPORE – Companies in Singapore spent less to employ expatriate middle managers last year, with overall pay packages marked by reduced benefits and a dip in salaries.
But cash salaries for expatriates here remain the fifth highest globally, according to a survey published by data and knowledge provider ECA International on Wednesday (Aug 25).
The average pay package for a mid-level expatriate here last year was US$225,171 (S$305,400), or around US$7,300 lower than the previous year. That made Singapore the 17th most expensive location globally for companies to send expatriates to. It was 19th the year before.
Japan overtook Britain to top the list, with an average package of more than US$405,000.
Mr Lee Quane, ECA’s regional director for Asia, noted that the leaner expatriate packages in Singapore mirror similar declines elsewhere, such as in Hong Kong and Thailand.
This was partly driven by “lower costs of accommodation and other benefits” commonly provided to white-collar expatriates, he said. But they were also earning about US$1,000 less in cash salary than their peers in 2019.
“Combined with its ranking as the location with the best quality of living globally (according to ECA’s location ratings), these trends serve to increase Singapore’s attractiveness to expatriates looking to move to the region,” Mr Quane noted.
The Republic will also be appealing to companies looking to set up a regional hub, given the cheaper cost of hiring expatriates, he added.
In Asia, the value of expatriate packages in Hong Kong fell by over US$5,000 in 2020 to about US$280,000, despite a slight average salary increase of US$265.
“While salaries for expatriates in Hong Kong rose by less than 1 per cent, employers were able to benefit from lower accommodation costs and reduce the… financial support for housing compared with the previous year,” said Mr Quane.
In Malaysia, there was a significant dip in the cost of benefits – close to US$2,000 on average. This was attributed to lower rents amid a lack of demand for expatriate accommodation due to the Covid-19 pandemic and travel restrictions.
In Thailand, the average value of a pay and benefits package for overseas employees fell by close to US$18,000. The country is no longer among the top 20 most expensive locations to employ mid-level expatriates.
But Taiwan has joined the ranks of the top 10 most costly locations.
This was largely due to a rise in the costs of benefits, which surged in part due to a steep increase in housing rents amid Taiwan’s initial success in mitigating the spread of Covid-19.
In becoming the 10th most expensive location to hire expatriates, it overtook countries like South Korea and Australia.
ECA’s MyExpatriate Market Pay survey includes information on benefits, allowances, salary calculation methods and tax treatments.
It appraised more than 300 companies across 160 countries in the later months of 2020.
Human resource advisory firm PeopleWorldwide Consulting’s managing director, Mr David Leong, noted that while basic salary would typically remain at about the same level, he has seen housing allowances and support for children’s education being shaved off in the past year.
“Overall pay packages for current expats see little contraction since they are subject to the Ministry of Manpower’s qualifications and if the package is reduced, it may affect their renewal chances,” he said.
Mr Leong added that there has been a notable rise in expatriates moving back to their home countries during the pandemic, with some facing different terms of employment if they continued working here due to companies tightening their belts.