As the economic crisis takes home, companies are looking to reduce their spend on fixed salary and short-term incentive budgets over the next 12 months, according to a survey conducted by global consulting provider Mercer.
The survey of 352 companies, indicated that national salary budgets have declined from five to four percent in the past six months, with businesses looking to reduce their cost base.
Broad-based performance and reward leader at Mercer, David Abusah, said Australian companies are shifting their approaches when it comes to wages in light of the deteriorating economy.
“What’s interesting though is that contrary to common perceptions, employers are not taking a broad-brush approach to cost-containment measures such as blanket workforce reductions, hiring, or wage freezes and are being targeted and differentiated in where they reduce their spend,” Mr Abusah said.
The survey has also shown that 16 percent of organisations will make job cuts in at least one segment of their workforce, and 36 percent are planning to adopt hiring freezes.
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