Malaysian employees and employers appear to be on different pages when it comes to compensation, according to new research. A comprehensive salary survey by foundit, a leading jobs platform, reveals that while many professionals see room for salary growth, organisations are focusing on strategic compensation planning to retain talent in a competitive job market. The research highlights evolving compensation trends in Malaysia, with a growing awareness among professionals about market benchmarks. More than half of the surveyed employees recognise the need for salary adjustments to align with industry standards, while nearly half anticipate modest single-digit salary growth in their upcoming reviews. 

These insights present valuable opportunities for organisations to enhance their talent strategies, ensuring competitive compensation structures that attract and retain top talent. With compensation playing a central role in both recruitment success and employee loyalty, these insights into workforce sentiment provide valuable intelligence for business planning. 

V Suresh, CEO of foundit, commented on the findings: "This research offers fascinating insights into Malaysia's compensation landscape, revealing both challenges and opportunities. The perception gap we've identified – where many employees believe their pay falls below industry standards – represents a critical area for employers to address. 

Malaysian businesses have a compelling opportunity to strengthen their position in the talent market through enhanced salary transparency and more effective communication about compensation. By helping professionals understand how their pay compares to true market rates and developing transparent frameworks for advancement, organisations can better align expectations with reality. This strategic approach benefits not just individual employees but strengthens organisational resilience and competitiveness. For Malaysia to continue its trajectory as a business hub in Southeast Asia, addressing these compensation perception gaps will be instrumental in attracting and retaining the best talent." 

Key findings from the survey include: 

Salary Perception Across Experience Levels 

1. More than half (52%) of employees believe they are underpaid compared to industry peers. 
2. 38% feel their salary is above average, while 10% are unsure how their pay compares to market rates. 
3. Executive-level professionals (15+ years of experience) have the highest salary awareness, with only 4.48% unaware of market benchmarks, compared to mid-career professionals who display greater uncertainty. 

Satisfaction with Salary Growth 

1. 30% of respondents are dissatisfied with their salary growth opportunities with majority in Engineering and Logistics sector. 
2. 38% remain neutral, indicating mixed perceptions about compensation structures. 
3. 32% express satisfaction, but satisfaction levels decline as professionals advance in their careers. IT (35.38%) leads in salary growth satisfaction. 

Expected Salary Growth from Appraisal 

1. 45% of professionals expect only a 0-10% salary hike in their next review. 
2. 28.7% anticipate a 6-10% increment, while 16.7% foresee just 0-5% growth. 
3. 19.5% of professionals aim for substantial increases exceeding 30%. 
4. Professionals with 4-6 years of experience are the most optimistic, with nearly 39% expecting 6-10% raises, while senior executives anticipate more conservative increases (0-5%). 

Salary Changes Over the Past Three Years 

1. 36% of professionals saw no salary growth, indicating wage stagnation. 
2. 30% experienced salary reductions (19% minor, 11% significant). 
3. 34% received salary hikes (18% modest, 16% substantial), highlighting industry-specific trends. 

Future Salary Expectations: Industry Outlook 

1. Employees in the Engineering & Construction sector expect predictable salary growth (36.36% anticipate 6-10% raises). 
2. BFSI professionals have the highest expectations, with more than 50% anticipating 30% above increments. 
3. Entry-level professionals remain the most optimistic, with 79% expecting salary growth, while expectations decline at senior levels (67% among executives). 

Key Drivers of Salary Trends 

1. Skills in Demand: 31.2% of professionals believe in-demand skills significantly impact salaries. 
2. Economic Trends: 30.5% see macroeconomic factors shaping pay scales. 
3. Sector-Specific Challenges: 18% cite industry constraints as key influencers. 
4. Technological Advancements: 12% recognise tech-driven disruptions affecting wages. 

For organisations navigating the complexities of talent acquisition and retention in today's competitive landscape, this research provides a valuable measuring stick for assessing current approaches and identifying areas for strategic improvement. By leveraging these insights to enhance both compensation structures and communication around pay, companies can create more appealing work environments that attract and retain top talent. 

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