Hays : Small salary increases ahead as cost consciousness stays in vogue – but employees are ready to respond

• Almost 7 in 10 employers will increase salaries by less than 3% when they next review;
• 9% will not give any salary increases;
• During the last 12 months 63% increased salaries by less than 3%;
• Kiwis are taking matters into their own hands: 53% will ask for a pay rise and turnover has already increased in 23% of organisations.

New Zealand employers will increase permanent staff levels, expect business activity to rise and say the skill shortage will impact the effective operation of their business or department, but this is not leading to big salary increases.

According to the 2016 Hays Salary Guide, released today and containing salary and recruiting trends for over 1,000 roles, just 23% of New Zealand's workforce can expect a salary increase of 3% or more in their next review. Instead the majority of workers (68%) will receive an increase of less than 3%. The final 9% will receive no increase.

During the last 12 months, 63% received an increase of less than 3%, 20% saw their pay increase between 3 and 6%, and a lucky 8% received a raise of 6% or more.

'We may no longer be a 'rock star' economy, but we still score goals when it comes to maintaining a buoyant recruitment market,' says Jason Walker, Managing Director of Hays in New Zealand. 'Employers are getting on with the task at hand by adding highly-skilled professionals to their headcount.

'But one thing they aren't doing en masse is using salary to attract and retain highly-skilled professionals. Despite a steady job market and demand outstripping supply for the top talent, especially those with local experience, for the most part employers remain cost conscious.'

According to Hays, this is leading to employees taking matters into their own hands. As Jason explains, '53% of employees say they'll ask for a pay rise in their next review. Another 30% are as yet undecided about popping the salary question. Meanwhile staff turnover has increased over the last 12 months in 23% of organisations.

'With employees ready to take action by asking for a pay rise or by looking for a new job elsewhere, one thing is certain - in the year ahead savvy employers will need to ease the purse strings for highly-skilled talent in demand.'

Other key findings:

• 70% of employers experienced increased business activity over the past 12 months, with 76% expecting it to rise in the year ahead;
• Staff levels are up too, with 45% increasing permanent headcount during the last 12 months. This outstrips the 17% who decreased it;
• Over the coming year 44% expect permanent staff levels to increase. Just 8% expect levels to fall;
• The news is positive for New Zealand's temporaries and contractors too, with 21% of employers expecting their use of such staff to increase. Just 12% say it'll decrease.
• Three-quarters of employers believe the skill shortage will impact the effective operation of their business or department in a minor (49%) or significant (25%) way;
• 76% would consider employing or sponsoring a qualified overseas candidate in skill-short areas, up from 70% last year.

The Hays Salary Guide includes salary and recruiting trends for over 1,000 roles. It is based on a survey of 419 organisations in New Zealand, representing 245,716 employees, as well as placements made by Hays.

Get your copy of the 2016 Hays Salary Guide by visiting www.hays.net.nz/salary, contacting your local Hays office or downloading The Hays Salary Guide 2016 iPhone app from iTunes.

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Hays, the world's leading recruiting experts in qualified, professional and skilled people.

For further information please contact Jason Walker, Managing Director of Hays in New Zealand, on jason.walker@hays.net.nz or +64 (0) 9 375 9424.