With costs rising across the board, it’s no surprise that cost of living and inflation remain top concerns for the majority of Australian workers. In an effort to alleviate these pressures, it seems businesses are stepping up to budget for these costs in their salary offers.
A new survey by Robert Half has found that nearly all business leaders are increasing their salary budget this financial year by an average of 26 per cent.
The data suggested that small companies are reporting budget increases of around 10 per cent compared to medium-sized companies (21 per cent) and large companies (29 per cent).
Other strategies to address pay in the current climate include clear communication about pay, increasing pay transparency, and addressing employee concerns about salary, according to the 300 hiring managers surveyed.
Interestingly, two-thirds of employers (63 per cent) reported extending pay rises only to those who ask for it while 3 per cent of employers don’t plan to give raises this year.
“Our research highlights that while salary is an important factor to workers, fewer employees are intending to raise salary issues with their employer than there are employers who are willing to give a raise,” noted David Jones, Senior Managing Director Robert Half Asia Pacific.
“In the current changeable economic climate, there’s no doubt that companies are under pressure to regularly evaluate and benchmark their remuneration structure against the market. This reinforces the importance of communication for both parties: employers should frequently address salary expectations with their valued team members, and workers should be upfront about their work-life needs – remuneration or otherwise – to ensure a transparent and satisfactory working relationship.”
On the employee’s side, less than half of the 1,019 respondents plan to ask for a raise before the end of 2022 though the majority (78 per cent) are likely to look for a new role if they don’t receive one, putting the onus on employers to address these concerns with their staff.
High workload, lack of flexibility, lack of career progression, and unhappiness with the job content are some of the other reasons employees would consider changing roles. Still, low salary remains a top concern for nearly 50 per cent of employees.
“While we know that flexibility has been a significant driver of employees’ and candidates’ decision making in the wake of the pandemic, remuneration is now becoming a primary concern as it’s expected to increasingly impact work-life,” added Mr Jones.
What else can businesses do to retain staff?
- Improve transparency about salary budgets so that employees can feel they are part of the decision-making process when it comes to raises
- Offer a better compensation and benefits package, such as additional paid leave or remote work options
- Consider routine bonuses and rewards to recognise strong employee performances
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