THE projection for salary hikes in Singapore has gone from bad to worse - from among the highest in Asia to one of the lowest.

In a reflection of how fast the Singapore economy is slowing down, a poll of 761 companies has projected that pay increases here are likely to average 3.7 per cent in 2009 - down from the 5.6 per cent actual rise in 2008, and the 5.9 per cent first projected last July.

Increments will be even lower when they are paid out, reported The Business Times on Monday.

The poll, conducted by compensation firm HR Business Solutions (HRBS), covered 20 economies in Asia.

It showed the projected pay rise for Singapore is higher than only that for Hong Kong (3.3 per cent) Macau (3.1 per cent), New Zealand and Japan (2.3 per cent).

An earlier HRBS poll carried out three months ago, when inflation was raging, showed that the more developed economies in the region - Japan, Australia, New Zealand, Hong Kong, Singapore and Taiwan - were expected to see salary hikes of 3.5 to 5.9 per cent in 2009, with Japan at the lower end and Singapore at the top.

Ms Elaine Ng, HRBS's managing principal and director, said the sharp decline in Singapore's relative pay hikes is not due to the flexi-wage system.

'The fact is that Singapore is expected to be the worst performing economy in Asia as a result of the financial crisis,' she explained.

'And the Singapore government has been taking the lead to reduce top honchos' salaries in the government sector.'

But the poll indicated that bonuses are tipped to be among the largest in region, even though they will be smaller than the 17.9 per cent dished out last year.

Singaporean workers can look forward to bonuses averaging 15.1 per cent of their annual pay for 2009, according to the survey. This is exceeded only by Russia, said the BT report.

Still, salary increases and bonuses payouts this year are likely to fall below projections because of the deteriorating economic crisis worldwide.

Ms Ng said most employers are cautious about the year ahead, with some expected to defer their increment date due to business uncertainty or even freeze salary.