Overview

• This article explores the role of salary analysis in helping businesses attract and retain top talent, manage compensation fairly, and stay aligned with market trends.
• ZMG Ward Howell, through its Research and Talent Intelligence (RTI) solutions, offers customized and research-driven salary analysis reports to help you better understand your market position and refine your compensation strategies with confidence.

As inflation affects the cost of living across the Philippines, averaging 3.2% in 2024 and only slightly easing to 2.1% by February 2025, employees continue to feel the pressure on their financial well-being. Businesses must be more proactive in reviewing their compensation structures.

Salary analysis is the process of examining market pay data to ensure that your organization’s compensation packages remain competitive, fair, and aligned with evolving expectations.

Let’s explore how important salary analysis in the Philippines is, the challenges involved, and how it can guide strategic HR decisions.

How Important is Salary Analysis in the Philippines?

Salary analysis is pivotal in the Philippines, especially as industries become more competitive and the talent landscape evolves rapidly. As an employer, you need accurate, up-to-date compensation data to attract and retain top talent, manage payroll budgets effectively, and ensure internal equity.

Whether you’re a multinational company expanding locally, a growing enterprise building your workforce, or a family-run business formalizing your HR practices, salary analysis gives you the insights to make smarter, more strategic decisions.

It helps you stay compliant with labor standards, avoid overpaying for underpaying staff, and position your organization as a desirable place to work in a competitive job market.

Key Challenges in Conducting Salary Analysis

When you’re trying to conduct a salary analysis in the Philippines, you may encounter several roadblocks that affect the accuracy and usefulness of your findings. These challenges can make it harder to develop competitive, fair, and sustainable compensation strategies that align with your business goals.

Limited Access to Reliable Market Data

One of the biggest challenges you’ll face in the Philippines is the lack of access to reliable, up-to-date market data. While some salary surveys and industry reports are available, they often lack depth, are expensive, or do not reflect current trends in your specific industry or region.

Smaller businesses or companies outside Metro Manila are especially vulnerable to working with outdated or incomplete information. This happens because there’s no centralized, publicly available salary benchmark system that consistently covers all sectors.

Without reliable data, it’s difficult to confidently adjust pay structures, resulting in missed opportunities to attract or retain top talent.

Wide Pay Disparities across Industries and Regions

Salary levels in the Philippines can vary widely depending on the industry, company size, and geographic location. For instance, an IT manager in Metro Manila may earn significantly more than one in a provincial city, even with similar responsibilities.

This disparity makes it harder for you to benchmark salaries accurately, especially if your organization operates across multiple locations or sectors. Additionally, this often occurs due to differences in cost of living, talent supply, and demand dynamics in each region.

Without a standardized reference, you may unintentionally overcompensate or undercompensate employees, which can lead to dissatisfaction, high turnover, or increased payroll costs.

Informal Labor and Underreported Compensation

Another challenge in the job market is the high prevalence of informal employment and underreported compensation. Many businesses, especially in rural areas or smaller industries, may not follow formal HR practices or fully report salaries and benefits. As a result, available salary data may not reflect the true earnings.

If you rely on such information, your salary analysis may become skewed and unrepresentative. This situation happens because informal work arrangements are often easier and more cost-effective for some employers but can lead to a lack of transparency.

This makes it harder to set competitive salaries based on fair market value and can complicate your efforts to create structured compensation plans.

Market Volatility and Economic Uncertainty

Fluctuating economic conditions in the Philippines, such as inflation, shifts in supply chains, or major policy changes can significantly impact salary expectations and labor costs.

When the economy is unstable, employees may push for higher wages to cope with rising living expenses, while businesses may struggle to maintain consistent compensation budgets.

You’ll find it challenging to use historical data or fixed benchmarks in such a volatile environment. This happens because market conditions can shift rapidly, making previously reliable salary figures obsolete.

To stay competitive and fair, you need to regularly review and adjust your compensation data, which requires both time and resources that many companies find hard to maintain.

Why Partner with ZMG Ward Howell for Your Salary Analysis Needs?

Partnering with us for your salary analysis needs means gaining access to deep, data-driven insights that go beyond surface-level compensation trends.

Through our Research and Talent Intelligence (RTI) solutions, we offer customized Salary Analysis reports that provide a clear understanding of your current market position, the compensation expectations of target talent pools, and opportunities to refine your job offers to attract the right candidates.

Our rigorous research process ensures accuracy, combining proprietary tools and market intelligence to deliver actionable findings that support smarter decision-making.

Quick Recap

Understanding how important salary analysis in the Philippines is enables you to see the difference between attracting top-tier talent and losing skilled professionals to competitors.

A robust salary analysis not only enables organizations to keep up with economic shifts but also ensures they stay aligned with industry benchmarks and talent expectations. The traditional approach of relying solely on internal equity to determine employee compensation is no longer sufficient. In today’s candidate-driven talent market, a more strategic and competitive method is to benchmark against market equity or what employees could command externally. This shift ensures that compensation structures remain attractive, relevant, and aligned with the market realities of talent mobility.

Looking to assess your compensation strategy? Contact ZMG Ward Howell today to discover how we can help you build a more competitive and future-ready compensation plan.