News release from Moyle Consulting

Pay stays ahead of inflation

Salary increases continue to outpace inflation, according to the 2010 Salary Review Survey by Moyle Consulting.

In a tough year economically, the survey shows a median 3% increase in base pay across all levels of staff during 2009. This compares with a median increase of 4% the previous year.

However, only 61% of organisations gave increases, compared with 97% the previous year, says Moyle Consulting director Jarrod Moyle. “Some will be surprised that even this many organisations made increases in 2009, but several respondents noted that increases were only for selected staff and not widespread across the organisation. Only 51% of organisations gave increases to senior managers.

As well as changes in the previous 12 months, the Salary Review Survey reports on expectations for the year ahead. Most survey respondents predict they will have to pay more in 2010, as the economy picks up. About 80% of respondents say they expect to increase pay, and the rest say pay will remain the same - there are no plans for a decrease. The projected median increase is 3%.

“Many organisations told their staff that it wasn’t possible to increase salaries last year, but promises were made to at least review salaries in 2010. There is only so long that employees will be prepared to accept a salary freeze. Without doubt, they will be looking for some financial recognition for sticking it out.“

Most organisations (65%) are planning for better economic conditions this year and 55% expect their sales revenues to improve. This will give weight to employees’ rising pay expectations, Mr Moyle says.

The pressure is on employers to improve the working environment, and not just through pay rises. The survey finds that retention of staff is a significant issue, as is provision of training and development, and elevating engagement. “There is more to employee satisfaction than money, and organisations recognise that professional development is a key way to increase motivation, Mr Moyle says.

Job prospects are also looking brighter for 2010 with 31% of organisations planning to increase staff and only 11% looking to reduce staff numbers. This time last year, 30% of respondents were planning staff reductions.

For pay rises, the best sectors to be employed in last year were Engineering/Contracting and Computing/IT, which reported median increases of 5%. The prospects for 2010 are worst in the Finance/Banking, Health and Public Sectors, with projected increases between 2% and 2.8%. Those with the best prospects are working in Construction/Property (3.3% pay rise projected) and Export/Import (3.5%).

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