Philippine employers are increasingly turning to benefits rather than hefty salary increases to retain workers as competition for skilled talent intensifies, according to global recruitment firm Robert Walters.

Only two in 10 employers plan to give salary increases above 6 percent this year, while bonuses, parental leave and medical insurance are emerging as key tools for keeping employees.

The shift comes even as companies remain upbeat about hiring, with 61 percent of surveyed employers planning to increase their headcount in 2026.

Finding workers, however, remains difficult. About 72 percent of employers cited a shortage of qualified candidates, while 64 percent pointed to salary and benefit expectations beyond their budgets. Another 41 percent reported intense competition for candidates, including counteroffers and buy-backs.

Amid those challenges, 29 percent of employers are freezing external recruitment to concentrate on developing and retaining existing workers. Only 10 percent expect to reduce their workforce.

“The Philippines is a high-growth engine for global outsourcing, and this dynamism creates ongoing challenges around talent retention,” Robert Walters Southeast Asia chief executive officer Kimberlyn Lu said.

Among employers surveyed, 82 percent offer bonus schemes, 68 percent provide shared parental leave and 63 percent offer commercial medical insurance.

Lu said companies are increasingly using non-cash incentives to retain talent and institutional knowledge as the business process outsourcing sector moves toward higher-value IT and finance roles.