In 2015 average Australian salary movements were lower across all job levels, across all job families and across all states and territories than previously experienced in Australia’s recorded history.
Forecasts for 2017 across regions and job categories anticipate similarly conservative average increases.
Closer examination of the 2016 financial year reveals that 58% of organisations increased salaries by less than 3%, while 20% gave increases between 3% and 6%. Business activity, business confidence and permanent headcounts may be rising, but according to all sources they are not translating into salary increases.
In 2016/17 salary reviews are anticipated by 96.1% of organisations. The average annual salary movement anticipated is 3%, a figure that has been in steady decline over the last five years. Despite the salary reviews, 12% of organisations expect to offer no increases.
And yet 64% of employers experienced increased business activity over the 2016 financial year and 70% expect further increased activity in the year ahead. Staffing levels are up, most sharply in the part time, temporary and contract space, and 60% of employers anticipate a reduced ability to attract and retain quality talent.
There are many perspectives on this puzzling situation and there are of course many extremes either side of the average findings. But much of the data points to declining profit margins. If business activity is up and availability of key talent is tight then wages should follow. Unless bridled by profitability.
Employees are starting to take matters into their own hands. Over 40% of employees say they’ll ask for a pay rise in their next review. Staff turnover in 2016 has increased in 29% of organisations, adding significantly to staffing costs.
Salaries will need to increase soon. The challenge for employers is to alter job descriptions so they deliver greater organisational value to maintain profitability. Outsourcing or automating non-core tasks is key. Leadership and culture play a large part in such a transition. Many will thrive but not all and we should expect to see employers rise and fal according to these challenges over the course of 2017.
HR, WHS and Learning & Development in 2016
Average HR salaries rose by 3.1% in the 2016 financial year, slightly higher than the national average. The number of jobs in this employment category was virtually unchanged, with new opportunities tending to be within larger public sector organisations or of a temporary or contract nature.
The Central Coast market remains flush with talented HR professionals across all levels actively looking for local opportunities. The median HR, WHS and Learning & Development package on the Central Coast is $71,175.
In the Hunter, HR employment has remained stagnant, particularly with regard to senior roles. The majority of activity has been at advisor level, or within the specialisations of employee relations or organisational development. The median salary package for this profession in Newcastle is $79,388, while in the Hunter Valley it is $68,700.
For safety professionals, we have seen the beginning of a conscious shift away from the compliance mindset. While WHS roles have traditionally been focused on development and maintenance of robust systems and policies, employers are now more interested in an ability to lead culture change and embed behavioural shifts. This talent is not easy to find but employers have been willing to make significant investment to secure it when they do.
Temporary and contract roles outnumber permanent opportunities significantly. Contingent workers have proven efficient at achieving short-term objectives often because there is greater clarity around outcomes, time frames and budgets without organisations having to commit to ongoing staffing costs. Many HR and WHS professionals are adapting their career plans and job expectations to this new project-based landscape, and many are finding satisfaction and variety in contract roles.
And in 2017
Nationally, the HR and WHS landscape will continue to offer more opportunities in specialist and niche roles and a greater reliance on contracting and temp expertise. Hiring and salary trends are evolving distinctly from one region to the next across Australia.
East coast cities are presenting good opportunities and good salaries in their CBDs and surrounding regional areas. Businesses in regional areas close to cities will save costs by hiring skilled workers who desire a lifestyle outside the city, and who are willing to forego the highest salary jobs to do so. This is certainly evident on the Central Coast and to a lesser extent Newcastle. However, the Sydney sprawl is starting to push Central Coast salaries upward and we expect this trend to continue into 2017 and beyond.
The rise of niche and specialised roles will drive salary differentiation and launch an upward trend in salaries across the profession. Specialists in workplace wellness, coaching, organisational development programs, mediation and employee relations, and remuneration and benefits will be in increasing demand to assist navigation of an ever changing, increasingly competitive business landscape.
Employers will continue to expect more from their safety executives. They will seek out WHS professionals who can demonstrate experience in changing the mentality of the organisation through a focus on human behaviour and motivation. These opportunities will continue to push salaries upwards in the coming years and the style of person attracted will consider it a three to five year project before moving on to the next.
The HR and WHS market will continue to be dominated by a rise in a more contract or project focused approach in 2017. Even though business confidence will continue to rise, many organisations will have adjusted to and benefitted from a more versatile, temporary workforce so may not return to the predominantly permanent HR team structure. If confidence continues into 2018 we may see a return to more permanent employment in this category.