By Alvin Foo

EVIDENCE is growing that Singapore workers can look forward to modestly fatter salaries next year and that the job situation here is improving.

A survey out last Friday from global human resources firm Hewitt Associates showed that employers in Singapore are poised to raise pay by 2.6 per cent next year.

In addition, most companies polled do not expect to freeze salaries next year - down from a high of 60.3 per cent this year, to just 12.8 per cent expected next year.

Mr Samir Bedi, Hewitt's South-east Asia performance practice leader, said: 'The compensation sentiment is more positive with organisations ready to take on 2010 with a fresh, energised outlook to manage talent.'

Hewitt's Singapore Salary Increase Survey polled 153 firms in July and August this year. Its findings came a day after human resource firm ECA International released a survey which showed employees here can expect a 3 per cent pay rise next year.

ECA also found 11 per cent of 99 firms polled here are proposing salary freezes next year, down from this year's 39 per cent.

Hewitt said 2009 also recorded the largest fall in pay rises here this decade, with salary rises falling from a high of 5.3 per cent last year to 1.8 per cent this year.

This year's modest rise came amid tough times, as companies were challenged to manage costs and productivity to remain profitable, it added.

Salary cuts were implemented at 11.5 per cent of the firms polled, but only 2 per cent expect to slash pay next year.

Employees are also likely to see slimmer bonuses this year. A total of 28 per cent of companies polled are cutting their 2009 year-end variable bonuses, of which 44 per cent expect a reduction of more than 20 per cent.

However, there are signs that firms here are planning to resume hiring.

Companies with a blanket hiring freeze are declining in number, while those resorting to a headcount freeze - in which they recruit only to replace - has gone up significantly.

Regionally, Hewitt said higher salary increases are expected next year throughout the Asia-Pacific.

However, the recent economic uptick has not yet made a significant impact on salary increases, noted Mr Surendran Ramanathan, head of Hewitt's rewards centre for South-east Asia.

He added: 'Companies are still being cautious, not willing to change salaries drastically even though they see some recovery.'

This article was first published in The Straits Times.