ONLY two in 10 employers in the Philippines plan to raise salaries by more than six percent this year, prompting companies to turn to other benefits to retain key employees, according to new research from global talent solutions company Robert Walters.
The shift reflects a growing focus on more tailored benefits as employers respond to changing workforce expectations and persistent recruitment challenges.
Recruitment challenges drive retention efforts
Despite the hiring challenges, 61 percent of Filipino employers plan to increase their headcount in the second half of 2026, the Robert Walters survey found.
Employers, however, continue to struggle to find qualified candidates. The top recruitment challenges include:
A shortage of candidates with the right skills or experience, cited by 72 percent of employers.
Salary and benefit expectations that exceed what companies can offer, at 64 percent.
Strong competition for candidates, including counteroffers and buybacks, at 41 percent.
These challenges are pushing more companies to invest in their existing workforce. About 29% said they are freezing external hiring to focus on developing and retaining internal talent, while only 10% plan to reduce headcount.
“The Philippines is a high-growth engine for global outsourcing, and this dynamism creates ongoing challenges around talent retention,” said Kimberlyn Lu, CEO of Robert Walters Southeast Asia. “While the market is not slowing down, employers are becoming highly strategic in their approach to talent retention.”
Benefits take center stage
While employers recognise the need to retain experienced workers, most are not relying on large salary increases to do so. Only two in 10 plan to offer pay hikes of more than 6% this year.
Instead, companies are expanding their benefits packages. Bonus schemes remain the most common perk, offered by 82% of surveyed employers, followed by shared parental leave at 68% and commercial medical insurance at 63%.
“Companies are ensuring their core talent is rewarded with robust benefits,” Lu said. “They are using non-cash levers to maintain loyalty and retain institutional knowledge, especially as the BPO sector continues its push towards higher-value roles in IT and finance.”
Still, companies need to look beyond standard perks to understand what keeps employees engaged for the long term.
The Robert Walters 2026 Salary Survey found that career growth and advancement remain the top factors influencing professionals’ decisions to stay with an employer.
Work-life balance also plays a key role. Employees tend to view their employers more positively when they feel valued as individuals rather than simply as resources.
As a result, companies are increasingly designing benefits around employees’ long-term well-being and career development instead of relying solely on higher pay.
The growing presence of younger workers is also expected to reshape workplace benefits and corporate culture as employers adapt to changing expectations. PR
