Career16: Pay rise on cards this year

By Danielle Wright

With business confidence high many employees -- especially those in Auckland -- should get a pay rise this year.
With business confidence high many employees -- especially those in Auckland -- should get a pay rise this year.

New Zealand has been less impacted by the economic downturns of Europe and Australia and we've been quite stable. There's a direct correlation between the country's economic performance, business confidence and the likelihood of salary increases.

If you overspent during the holidays, relax. According to recruitment consultants Robert Walters' annual survey of more than 500 business professionals in New Zealand, nearly three quarters expect a pay rise or bonus this year.

The respondents were from a number of industries including accounting, banking, financial services, human resources, information technology, procurement, supply chain, sales, marketing, secretarial and business support.

James Dalrymple, director of Robert Walters Auckland, has been with the company almost 10 years and says despite some negative news out of China and dairy prices falling, there's still a buoyant and confident business climate in Auckland, which made up 48 per cent of survey respondents.

"New Zealand has been less impacted by the economic downturns of Europe and Australia and we've been quite stable. There's a direct correlation between the country's economic performance, business confidence and the likelihood of salary increases," says Dalrymple.

"Our survey results point to employees' expecting that business confidence to filter down in the way of pay-rises and bonuses. It may not happen, but that's the expectation."

However, Dalrymple says businesses tend to run quite lean at the moment and notes that there have been major restructures of large corporates in the past 12 months.

Redundancies and the fact employees may be taking on more responsibilities may also account for the high expectations of pay rises and bonuses.

There's also much competition for candidates.

"We're definitely seeing more movement across our candidate base driven by people moving jobs either for career progression or simply wanting better flexibility/conditions or higher salaries," says Dalrymple.

"It's across all the sectors and is a trend for more natural churn across the workforce."

The outlook isn't so rosy for Wellingtonians. Only 63 per cent believe they are in line for a pay rise (compared to 75 per cent in Auckland) and just 23 per cent are preparing for a bonus (compared to 49 per cent in Auckland), but it's not down to a sunnier disposition.

"Aucklanders are more optimistic about a pay rise or bonus than Wellingtonians, probably because a high proportion of Wellingtonians work for state-operated enterprises where they will not be eligible for bonuses or salary increases," explains Dalrymple. "Financial rewards are less likely in those sectors than in the private sector."

A survey by the Auckland Chamber of Commerce last year found that business confidence was strongest closest to the country's economic powerhouse, which reflected the fact that the economy in Auckland was expected to grow for years to come with significant infrastructural developments under way.

So, which professions will be the best off?

It seems if you're in sales and marketing you already received the biggest pay rise last year out of any of the other industries surveyed. Almost three quarters of sales and marketing professionals surveyed (70 per cent) received a salary increase last year, and 39 per cent received a bonus payment on top of their base salary.

Those in human resources, however, are the most optimistic in terms of expectations of a pay rise this year. Three quarters of respondents anticipate one, yet only 29 per cent of accounting and finance professionals expect to receive a bonus this year.

Last year, just over a quarter of accounting and finance professionals (26 per cent) received a bonus -- most were worth 1-10 per cent of their base salaries.

Bonuses were more commonly awarded for meeting individual targets, for strong performance or profit generation.

Just over half the IT professionals surveyed (53 per cent) received a salary increase last year and most (61 per cent) expect a pay rise this year, when 29 per cent expect a bonus.

Most secretarial and business support professionals (73 per cent) expect a pay rise this year, and just 29 per cent are expecting a bonus.

"Businesses across the board are working hard to retain their valued employees, [so are] proactively reviewing salaries and offering increases where appropriate as part of the retention policy," says Dalrymple.

How much should you expect?

Dalrymple suggests a conservative salary increase in the range of 2-3 per cent and a good time to bring up the idea of a pay rise, if it's not an automatic annual discussion in your company, is around performance reviews, presuming it's a positive review and you can answer yes to the question, "Do I deserve a pay rise?"

If you're asking for a rise, put your case forward without making it personal. State the facts of how you've increased the businesses opportunities or bottom-line, rather than talking about your high mortgage repayments and the cost of living.

You'll also want to go into the meeting armed with information about how much others in your industry earn in comparison so you know your market rate, and be aware if your job is in high demand or if plenty of people are waiting to fill your shoes.

Gather endorsements from clients and bring up recent achievements and be prepared to negotiate.

If you're a contractor, you might have to wait for a pay increase because the survey focused only on permanent candidates.

- NZ Herald

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