50% of Australia’s mining employers will give their staff a pay rise of up to 3% in their next review, but 35% will not increase salaries at all.
The annual Hays Salary Guide shows that 19% of overall employers intend to award a salary increase of between 3-6%.
Just 5% of employers will increase salaries at the higher level of more than 6%. This represents a slight drop over the last 12 months, since 7% of employers awarded a pay rise of more than 6% in their last review.
IT & Telecommunications tops the list of most generous industries, with 20% of employers intending to award salary increases of 6% or more in their next review.
The Hays Salary Guide is based on a survey of more than 2,950 organisations, representing 3,021,984 employees, as well as placements made by the recruiter. It shows that employers have a positive outlook yet remain cautious when it comes to salaries.
“Despite rising headcounts, business activity and sentiment, a cautious approach to salary increases prevails,” says Nick Deligiannis, Managing Director of Hays in Australia & New Zealand. “We’re seeing sedate salary rises across most industries and sectors, which is also at odds with other trends.
“For instance, employees are responding to rapid technological change by investing in their own skills development. They’re also more productive thanks to technology. Add the number of employers who say business activity has and will continue to rise, and such small salary increases will test the loyalty of employees.
“Even the time-honoured supply and demand principle has failed to impact salaries in all bar a few instances.
“But Australia’s strengthening economy, rising business activity, growing headcounts and skill shortages cannot be overlooked for too long. The piercing question then is how high will turnover reach before typical salary increases climb above 3%?”
Other findings from the Hays Salary Guide include:
• Business activity increased for 70% of employers in the past 12 months, while three-quarters (75%) expect it to increase in the next 12 months;
• 36% foresee a strengthening economy in the coming six to 12 months;
• 45% of employers expect to increase permanent staff levels, far exceeding the 11 per cent who say they’ll decrease;
• Meanwhile 23% expect to increase their use of temporary and contract staff, also exceeding the 9 per cent who anticipate decreasing in this area;
• 23 per cent of organisations now employ temporary and contract staff on a regular ongoing basis and another 44 per cent employ them for special projects or workloads;
• In the last 12 months, 15 per cent of Australians asked for a pay rise but were declined – a further 17 per cent asked for a pay rise and were successful;
• The success of the latter perhaps explains why 45 per cent say they intend to ask for a pay rise in their next review. A further 24 per cent are as yet unsure;
• 32 per cent of employers say staff turnover has increased in their organisation;
• 65 per cent of employers, compared to 60 per cent last year, are worried that skill shortages will impact the effective operation of their organisation or department in a significant (23 per cent) or minor (42 per cent) way;
• 38 per cent of employers say they ‘sometimes’ counter-offer staff when they resign and 2 per cent say they always counter-offer resigning staff;
• Yet of those counter-offered, 48 per cent left anyway, 22 per cent accepted but stayed 12 months or less, and just 30 per cent accepted and stayed over 12 months;
• 71 per cent of employers offer flexible salary packaging. Of these, the most common benefits offered to all employees are salary sacrifice (offered to all employees by 57 per cent of employers), above mandatory superannuation (41 per cent), parking (32 per cent) private health insurance (30 per cent) and bonuses (28 per cent);
• 70 per cent of employees have access to flexible work practices, 58 per cent receive ongoing learning & development, 43 per cent career progression opportunities, 37 per cent health and wellness programs, and 29 per cent over 20 days’ annual leave and financial support for study.