Oct. 29--A more positive market outlook for salary increases next year should result in compensation increasing by an average of 4.7 percent, according to Hewitt Associates.

The global human resources consultancy said this would be an improvement on the 3.4 percent average rise in salaries seen this year.

From its salary increase survey conducted across 153 companies from August to September 2009, 42 percent of respondents had frozen pay rises this year, but only 14 percent plan to do so in 2010.

The 2008 economic downturn had hit all economies across the globe including Thailand, where companies took short- and long-term measures to mitigate the recession's impact, said Surendran Ramanathan, head of Hewitt's Rewards Centre for Southeast Asia.

Employers seem more confident of a recovery in 2010 with salary projections increasing slightly on 2009 across all employee groups and industries.

The automotive and vehicle manufacturing industry provided the highest increase in 2009 at an average of 6.7 percent. This is possibly a result of the sector's drastic cost-cutting early in the year. As the economy and vehicle sales begin to pick up, companies will allocate more money for rewards.

The lowest salary increases reported in 2009 were in the transport, logistics and shipping sector and in the high-tech and information technology industries. They continue to project the lowest salary increases for 2010.

Variable pay programmes continue to be a key compensation factor with 80 percent of surveyed companies confirming their use of the practice.

While firms have adjusted their salary increases upward to reflect a reviving economy, variable bonus payouts for 2009 remain stagnant.

In fact, 22 percent of participating companies indicate plans to reduce their year-end variable payouts. This is partly due to companies wanting to ensure cost-effective management whilst maintaining focus and drive on sales and performance.

Mr Ramanathan said that as the local crisis appeared to have eased and recovery was in sight, turnover rates had followed suit. The voluntary turnover rate in 2009 was 9.3 percent, up from 7.8 percent in 2008.

The highest turnover rate continues to be in professional services at 21.4 percent, while the lowest turnover rate was seen in the chemicals industry at 6 percent.

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