Unveiling Wages: The Latest Trends in Pay Transparency

Alex Springate contributed to this report.

In 2021, the COVID-19 pandemic brought a spotlight to pay transparency, as the Great Resignation showcased employees’ desire for fair and equitable compensation. Embracing regional expectations and staying ahead of legislative and competitive shifts through 2025 creates an exciting opportunity to thrive, even in uncertain economic times.

Pay Transparency in the United States

In today's competitive job market, transparency in salary information is becoming a key strategy for employers. By leveraging platforms like LinkedIn and Indeed to openly display pay ranges, companies aim to attract top talent with a clear and appealing salary structure. Yet, this approach can lead to challenges such as pay disparities and differing expectations, which makes addressing these issues crucial for success. Enhancing wage transparency not only fosters a fair and equitable workplace but also builds trust within organizations and helps maintain a competitive edge. 

Employers are underestimating current employees’ interest in salary disclosure. According to Mercer’s 2024 Global Pay Transparency Survey Report, employers believe that candidates searching for new roles expect pay transparency on job ads. However, we find that employers do not provide the same visibility to pay disclosures for internal prospects.  

If wage visibility is not prioritized for current employees, the influx of new hires may not compensate for the loss of employees seeking better pay elsewhere.  

Employees now can view the prevailing rates for their role and can use this information to bargain for additional benefits or even a promotion if their skills have grown well beyond those of other candidates. However, potential candidates and current employees have not taken kindly to attempts to circumvent the compensation range requirement by posting extreme ranges in job postings as stated by SHRM, so companies should take an honest approach to sharing this data. 

Engaging in positive conversations with existing employees about salary disclosure can significantly boost employee satisfaction and tenure, while also addressing fair pay issues and gender discrimination. Addressing fair pay issues gives companies an advantage in the talent market as fair pay is the second-most cited reason for employees to stay at their current company. Over 50% of companies planning to implement pay transparency cite improving employee satisfaction and aligning with company values as key reasons. It can also help reduce gender-based pay discrimination by providing visibility into all levels and departments.  

Timeline expectations for pay disclosure also vary across regions. Though strides have been made on the local and state legislature levels, there has not been legislation passed nationwide directly addressing this issue. The Salary Transparency Act was introduced in Spring 2023 with the goal to require “employers to disclose the wage or wage range in the public or internal posting of an employment opportunity,” but it has not made significant movement since then.

Pay Transparency in the UK and European Union

Pay transparency has been a large focus of the EU and UK in recent years, most notably with the aims to reduce pay gaps between men and women doing the same jobs. The introduction of the EU Pay Transparency Directive in 2023, due to come into force in 2026, will require companies to: 

• Disclose pay gaps between men and women (explaining gaps over 5%)  

• Disclose the ratio between highest paid individuals and the company average  

• Provide information on pay as part of the recruitment process  

• Give workers the right to request average pay information for similar roles 

While the UK post-Brexit will not have an obligation to level up their own regulations to be in line with the EU, many global organizations with operations across the UK and Europe may find themselves applying a consistent approach to their pay reporting in the EMEA region.  

There are several possible impacts that companies will need to be prepared for following each government’s adoption of the directive into their own law. The most concerning ones that organizations need to prepare for are:  

1. Transparency of current inequity which could impact ‘workplace morale’ and increase employee turnover. 
2. Increased employment costs in the immediate to overcome current pay gaps, particularly if employee retention is key. 
3. Higher levels of competition, due to transparency of advertised salaries, which could push up salaries for in-demand roles and lead to reduced levels of hiring as a result. 
4. Challenges of attracting candidates under set pay bandings with less flexibility to pay more than their current workforce 

Pay Transparency in the Asia-Pacific Region

In the APAC region, there aren't as many laws about pay transparency, with India and Japan being the only two countries having legislation geared towards it. In India, the Securities and Exchange Board of India (SEBI) released the Business Responsibility and Sustainability Report (BRSR) requiring companies to disclose salary, benefits and gender representation information. Japan took a similar step in creating the Act on Promotion of Women’s Participation and Advancement in the Workforce, requiring companies to report gender wage gaps within three months of the end of a company’s fiscal year. It should be noted that the legislation in Japan is focused more on closing the gender wage gaps than an individual employee’s ability to advocate for market wages but both issues are important to address inequalities in wages. Although legislation in the APAC region is lagging that of the US and the EU, an initiative-taking approach from industry leaders in this region may force changes through market competition. 

On the matter of advertised salaries, there is a stark difference between how the countries in the EU and Asia approach this matter, with only 14% of organizations in China, Singapore, Hong Kong and India sharing pay information externally, and 84% having no intention to in the near future. While Australia has banned the use of “Pay Secrecy” clauses in employment contracts – removing penalties for discussing pay among employees – pay transparency policies still lag behind European markets. 

The Importance of Pay Transparency in Modern Workplaces

Across the globe, many employers have said that they want to take advantage of the benefits that pay transparency brings but they are slow to do so. Only 19% of companies have a strategy in place while 63% say that they plan to do so. 

Companies should ensure that they keep employees updated on the progress of the implementation or risk giving the impression that it is not a priority. Once companies implement pay transparency initiatives, candidates and current employees will have access to compensation data, meaning companies need to be prepared for the number of employees who may immediately be raising concerns about where their wages fall in comparison.  

HR departments should be prepared to address these concerns proactively to avoid inadvertently creating a bottleneck that leads to employee attrition. Companies should be ready to engage both current and potential employees: they can offer the current compensation data to entice job seekers and be ready to make changes for those that are already there. These strategies are essential to retain talent and maintain trust, as they are increasingly aware of prevailing wage rates and expect honest communication from their employers. 

Median income in Singapore mirrored many developed countries last year, rising 3.4% overall. The country is coming off a period of massive productivity and wage growth. From 2014–2019 real wages jumped 20.4% as investment poured into the country. Since then, nominal wage growth (without adjusting for inflation) was only 0.5% lower from 2019-2024 but real wage growth plummeted to just 3.6%. Inflation has taken the front seat as the chief driver of wage growth in Singapore, but that may change this year.  

Minimum Wages

Around the globe, many countries are implementing significant minimum wage increases to address the rising cost of living and inflation. This trend reflects a broader commitment to ensuring fair wages and reducing income inequality, ultimately fostering happier and more economically stable societies.  

Since 2020, most OECD countries have seen a significant uptick in minimum wages to combat the rising costs of living and high demand for workers, which has led to fast-rising average salaries. Of the selected countries in “Minimum Wage and Average Wage Growth in OECD Countries,” annual wages grew 16% on average from 2020-2023, but the variance is large, with Japan seeing only a 3% increase (although a 5.1% increase is due at the end of March 2025) compared to Poland seeing a 30% increase in this same period. 

At the same time, minimum wages have attempted to keep pace relative to the average wage change, but results have varied again by country. In Germany, the minimum wage ratio increased by 5.5ppts to 52% from 2020-2023, while in Poland this ratio remained relatively flat over this period at around 55% due to the larger increase in average wages. Context is key, as the US ratio has continued to fall due to the lack of uplifts to the federal minimum wage despite increasing wage growth.  

Many European and OECD countries have seen even greater minimum wage increases in 2024, such as Romania (23%), Poland (19%), the UK (10%), Australia (9%) and Hong Kong (7%), with more increases planned for 2025. Other Asian economies are also looking to improve minimum pay, with rises set for this year across Malaysia, Thailand and Indonesia, following increases in 2024 for Vietnam and the Philippines. 

Overall, these increases point to the increasing competition for workers, even among low-skilled roles as labor markets remain tight. It is important that employers understand the impacts of this and plan for further increases in workforce costs over the coming years.