There is a sentence we hear in almost every senior-level hiring conversation, from both sides of the table:

“They are currently earning X, so that is roughly what they are worth.”

It sounds logical. More often than not, it is wrong.

A current salary is a historical data point. It reflects what someone negotiated—or failed to negotiate—at a particular moment, with a particular employer, under a particular set of market conditions.

It does not necessarily tell you:

• What that person is capable of delivering today

• What the market would pay to secure that capability now

• How scarce their expertise has become

• What it would cost the employer to replace them

Yet across many APAC hiring discussions, current compensation continues to be treated as one of the most reliable indicators of professional value.

At Stemgenic, we would argue that it is often one of the least reliable.

This is not merely an academic distinction. It influences real career and hiring outcomes.

It keeps underpaid engineers underpaid for years. It encourages hiring managers to undervalue scarce talent because “that is what they are earning now.” It also causes candidates to limit their own expectations by anchoring themselves to a figure established by an employer several years earlier.

Why Pay Falls Behind Value

Salary moves in steps. Professional value develops continuously.

Employees acquire new skills, manage larger teams, solve more complex problems and take on greater commercial or operational responsibility throughout the year. Market demand for particular capabilities also changes constantly.

Compensation, however, is usually reviewed only once a year—if it is reviewed at all.

Even then, adjustments are often restricted by:

• Internal salary bands

• Annual budget cycles

• Standard percentage-increment policies

• Promotion structures

• Management discretion

• The willingness of a manager to fight for additional budget

This mismatch compounds over time.

Someone who joins below market often remains below market because every future increment is calculated as a percentage of an already-low base.

Someone who stays with the same employer for many years may accumulate highly valuable technical, operational and leadership experience, while their compensation continues to rise through modest tenure-based adjustments that were never designed to track the external market.

The result is that two professionals with similar responsibilities and capabilities can sit far apart in compensation—not because one is substantially more valuable, but because of when they joined, how they negotiated and how their employers managed pay historically.

Three Patterns We See Repeatedly

1. The Underpaid Hire Who Never Resets

We regularly meet process engineers, plant managers, R&D leaders and technical specialists across chemicals, food science, industrial manufacturing and healthtech who entered their organisations below market.

Sometimes they joined during a downturn. Sometimes they negotiated cautiously. In other cases, the employer simply paid below market across the organisation.

Years later, the gap remains because every increase has been calculated from the original, artificially low salary.

One specialty chemicals plant manager we engaged had progressed from an entry-level position to running an entire site operation. His responsibilities had expanded dramatically, but his compensation had grown mainly through standard annual adjustments.

By the time we spoke with him, the market value of his experience was approximately 40% higher than his existing salary.

His current pay told us very little about what he was worth. It mainly told us how conservatively his first offer had been structured.

2. The Candidate Who Has Gone Two Years Without a Raise

This is one of the clearest examples of the difference between pay and value.

Salary freezes are common during periods of restructuring, weak business performance or cost control. Employees are often told that the adjustment will come during the next review cycle. Sometimes it does. Frequently, it does not.

If comparable market salaries rise while an employee’s pay remains unchanged, the employee has not necessarily become less valuable. Their employer’s compensation process has simply failed to keep pace.

We have met automation engineers who independently developed advanced robotics and systems-integration capabilities while their salaries remained frozen. Their technical value increased substantially, but their internal compensation did not move because the new expertise had not been accompanied by a formal promotion.

The payslip remained unchanged. The capability did not.

3. The Long-Stayer Who Never Tested the Market

Long tenure is often misunderstood.

Hiring managers may interpret it as a sign that someone has become too comfortable. Candidates may also assume that remaining with one employer for eight, ten or twelve years means they should keep their salary expectations modest.

In reality, long tenure without external benchmarking frequently leads to underpayment.

Internal promotion increases are usually more conservative than the premium employers are prepared to pay when hiring the same capability externally. As a result, market-rate corrections tend to happen most reliably when someone changes employers.

This creates what is often described as a loyalty tax.

A professional who changes companies every three or four years may out-earn an equally capable colleague who remains loyal to one organisation—not because they are more competent, but because their salary has been periodically reset against the external market.

We have placed aerospace and industrial OEM engineering leaders who spent more than a decade with one employer. Their institutional knowledge, technical depth and ability to navigate complex operations were genuinely rare.

Their salaries, however, looked unremarkable beside those of less experienced professionals who had simply changed employers more frequently.

Why the Gap Can Be More Pronounced in APAC

In parts of Southeast and East Asia, direct salary renegotiation can be uncomfortable.

Requesting a market correction outside the formal review cycle may be perceived as confrontational or as challenging a manager’s judgment, particularly in organisations where hierarchy and workplace harmony carry significant weight.

As a result, many employees do not ask.

They wait for the next review. Then the next one. The difference between compensation and market value widens quietly until an external opportunity forces the comparison into the open.

At that point, the employer may suddenly produce a substantial counter-offer—belatedly closing a gap that the internal compensation process should have addressed much earlier.

The counter-offer may appear generous, but it often reveals something more fundamental: the employee had been underpaid for years.

What Should Determine Market Value?

If current salary is not the correct benchmark, what should employers and candidates examine instead?

Scarcity

How many professionals can genuinely perform this work at the required level, within the relevant location, industry and regulatory environment?

A capability that is common globally may still be scarce in a specific APAC market.

Demonstrated Business Impact

What has the individual built, improved, launched, protected or scaled?

Consider measurable outcomes such as:

• Revenue generated

• Costs reduced

• Capacity increased

• Downtime prevented

• Quality improved

• Safety risks reduced

• Products commercialised

• Teams built or transformed

• Regulatory approvals secured

Professional value is more accurately reflected by outcomes than by a historical payslip.

Current Market Benchmarks

Compensation should be assessed against genuinely comparable positions in the external market.

That means comparing the role based on scope, complexity, geography, team size, technical requirements and business impact—not relying only on internal salary bands created during an earlier hiring cycle.

Replacement Cost

What would happen if the person left tomorrow?

Replacement cost includes much more than the new employee’s salary. It can also include:

• Search and recruitment costs

• Time spent interviewing

• Vacancy-related productivity loss

• Knowledge transfer gaps

• Onboarding and training

• Time required to reach full productivity

• Operational or commercial disruption

In specialist and leadership appointments, the true cost of replacement may be substantially higher than the compensation adjustment required to retain or hire the right person.

Urgency

How quickly can the organisation secure the capability?

A role that can remain vacant for six months carries a different value profile from one where every month of delay affects production, compliance, safety, customer relationships or revenue.

None of these factors depends on what the individual earned last year.

They depend on what the capability is worth in the market today.

For Candidates: Negotiate From Value, Not History

When a recruiter or hiring manager asks about your current salary, recognise the risk: the discussion may become anchored to your past compensation rather than your present market value.

A stronger approach is to redirect the conversation toward:

• The market range for comparable positions

• The scope and complexity of the role

• The scarcity of your expertise

• The outcomes you have delivered

• The level of responsibility you are expected to assume

If you have gone two years without a salary increase, that does not prove that your value has remained unchanged. It may simply mean your employer’s internal process has fallen behind the market.

If you have stayed with one organisation for a decade, do not automatically interpret that tenure as a reason to lower your expectations.

Long-term employees often possess significant commercial value through:

• Deep institutional knowledge

• Cross-functional credibility

• Technical continuity

• Trusted internal and external relationships

• Proven delivery across multiple business cycles

These qualities are difficult to replace and are frequently undervalued within established internal salary structures.

Candidates should not exaggerate their worth, but neither should they allow an outdated salary to define it.

For Hiring Leaders: Anchoring to Current Pay Is a Costly Habit

When an employer offers a candidate “a reasonable increase” over their existing salary rather than assessing the market value of the position, it creates a significant hiring risk.

A 20% increase may appear generous when compared with an underpaid candidate’s existing package. It may still be materially below the market rate for the role.

This can lead to several outcomes:

• The candidate rejects the offer

• The existing employer successfully counters

• A competing employer presents a better-benchmarked package

• The candidate accepts but leaves once their true market value becomes clear

• Internal pay inequities emerge after joining

We see this repeatedly.

An employer makes an offer that looks attractive relative to the candidate’s current salary and assumes it is competitive. The candidate then accepts a counter-offer or joins another organisation because the original offer was never tested against the external market.

It was benchmarked against a number that was already wrong.

The Better Question

The solution is simple in principle, even if it is uncomfortable in practice.

Stop asking:

“How much more should we pay than this person currently earns?”

Start asking:

“What are this role, this capability and these outcomes worth in the market today?”

That is a more demanding conversation.

It requires real benchmarking, an honest assessment of scarcity and a clear understanding of the business impact of the appointment.

But it is also the conversation that produces fairer decisions, stronger hires and offers that are far more likely to stick.

Your current salary is a record of what happened in the past.

Your market value is determined by what you can deliver next.