Business Times

Asian wage growth remains positive despite economic crisis:ILO

The worldwide financial and economic crisis cut global wage growth by half in 2008 and 2009, however in Asia wage growth slowed but remained positive, says a new report by the International Labour Office (ILO).

Growth in average monthly real wages in Asia fell from 7.2 % in 2007 to 7.1 %t in 2008. In 2009 the provisional estimate for wage growth is 8 % – which would be by far the best performance of any region in the world.

However these figures are heavily influenced by China (which accounts for more than half of total wage employment in Asia); other countries had a much more mixed experience. For example, Japan saw real wages fall nearly 2 % in both 2008 and 2009. In the Philippines and Malaysia real wages fell by more than 4 % in 2008, and in Thailand they fell by almost 2 % in 2009, the report said.

The “Global Wage Report 2010/2011 – Wage policies in times of crisis” analyzes data from 115 countries and territories, covering 94 % of the approximately 1.4 billion wage earners worldwide. In Asia wage earners account for about 35 % of the employed population.

The report – the second issued by the ILO on wages since 2008 – says that the overall short-term impact of the crisis on wages should be looked at within the context of a long-term decline in the share of wages in total income, a growing disconnect between productivity growth and wages, as well as widespread and growing wage inequality.

Many countries have seen an increase in the share of low-wage employment in the past 15 years, including Australia, China (among non-migrant workers), Indonesia, Japan, Korea and New Zealand and the Philippines. In Korea 25 % of full-time workers are now in low wage employment and in the Philippines 15 % of all employees are in low wage employment.

Low pay also tends to be concentrated in certain groups, such as those with low education levels, insecure jobs, workers in small enterprises, youth, women and minorities – ethnically, racially or immigrants.

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