The companies in Bahrain are anticipating salary hikes of 5.2 per cent next year, an increase over last year's 4.7 per cent projection, said a report.

Employers across the GCC are predicting an average salary increase of 5.5 per cent in 2014 - a figure in line with forecasts made for 2013 and 2012, which were both at 5.4 per cent, indicating a continued confidence in the economic stability of the region and an increasingly resilient business environment.

These are the latest figures from Aon Hewitt, the global talent, retirement and health solutions business, released as part of its annual Global Salary Increase Survey 2013.

Based on data from a robust comparative group of more than 500 organisations from all industry sectors in the region, the report offers a unique snapshot of salary increase trends which, in turn, enables organisations to benchmark their forecasts with the market in order to remain competitive.

Among the participating GCC organisations, Saudi Arabia-based companies gave the highest salary increase projection for 2014 at 6 per cent.

This is a slight increase on last year's 5.8 per cent predicted raise and comes at a time when the kingdom's economy is growing, with economists forecasting a growth rate of 5.3 per cent for 2013.

Meanwhile, those based in the UAE predicted the lowest at 5 per cent, which is in line with last year's predictions of 5.1 per cent, indicating stability.

Kuwait and Oman firms estimated a 5.6 per cent salary growth, similar to the 2013 predictions.

"Looking back to 2012 and comparing the predictions from the survey for 2013 at 5.4 per cent with actual rises awarded earlier this year at 5.3 per cent, we see good alignment, allowing employees to feel confident the trend is set to continue into 2014," an Aon Hewitt spokesman said.

"Whilst linking individual performance to pay is not uncommon, we advise employers to use annual bonus payments as the larger component for rewarding high performers," said Aon Hewitt Middle east compensation salary manager Robert Richter.

"Salary increases typically take into consideration a number of other factors as well as performance, including inflation, to reflect promotions, and the need to ensure that employees at the same grade remain within a single pay band."

Aon Hewitt has been conducting the survey on an annual basis across the globe for 36 years and launched it in the Middle East for the first time in 2009.-TradeArabia News Service