Big pay rises forecast for skilled workers

By Amelia Wade

Photo / Getty Images
Photo / Getty Images

Salaries in high-demand industries are expected to rise this year as New Zealand's talent pool dries up.

Salaries are likely to jump by up to $20,000 a year in sectors where there is high demand for certain skills, statistics show.

But a trade union says significant rises are only happening at the higher end of the income bracket, while those workers at the bottom get next to nothing.

And although the country's biggest companies are based in Auckland, Wellingtonians will still earn tens of thousands of dollars more in most professions.

The global Robert Walters Salary Survey 2013, released exclusively to the Herald, looked at last year's salaries and made predictions for this year for more than 120 positions - including permanent, interim and contract work - in the country's two biggest cities. The report assessed sectors the firm recruits in.

In Auckland, the upper-end of tax accountants' salaries leapt from $100,000 a year last year to $120,000.

And the expected salary range for financial controllers with more than six years' experience went from $120,000 to $180,000 last year, to $120,000 to $200,000 a year.

Robert Walters' New Zealand managing director Richard Manthel said the bump in pay was because of an increasing confidence in business.

He predicted more jobs would be on offer in the coming months.

"When employers start to hire staff, that puts pressure on the skill sets and when there's demand for a skill set, salaries will obviously go up," he said.

Because New Zealand's economy is so small, the market for a particular talent can dry up if five people move overseas, or it can be flooded if 10 people with a certain skill graduate university at one time, Mr Manthel said.

But First Union general secretary Robert Reid said those workers who really needed increases were being offered a pittance.

"What we are seeing late last year and early this year is many employers trying to screw the wage [rises] of the majority of their workers down to not much more than the rate of inflation, which is under 2 per cent."

Mr Reid said only a year ago those salary increases for lower paid employees were between 3 and 5 per cent.

He said the union, which represents 27,000 workers in finance, industrial, distribution, transport and retail, had not noticed an increased confidence in business at salary review time.

"We're being told they don't have enough money for that, things are tight, things are hard and that workers should expect no more than the rate of inflation which at the moment is between 1.6 and 1.8 per cent."

He said salary jumps of $20,000 pointed to the growing inequality between highly skilled workers and workers who desperately needed more money.

"Not so they can worry about their next overseas trip or next holiday home or next meal at a restaurant, but those who actually worry about is there even enough food to put on the table for the week."

Mr Reid said Government sector workers had received only between 0 to 2 per cent wage rises for the past four years.

Recruitment company Hudson's executive general manager Roman Rogers said it was important that people realised remuneration wasn't a silver bullet.

"While it is important and a priority for many employees, I think what employers need to do is take a more holistic view around what they're offering and think about remuneration, work options, commitment to career paths. There's a risk that people over-simplify this and make it all about the money."

Mr Rogers said one of the biggest sectors this year would be IT because of companies updating software and getting new data systems in place.

The Canterbury rebuild meant the property and construction sector would see a boost as well as residential building in Auckland.

The financial service and Government sectors would likely also see growth.

Mr Manthel said while many of the country's biggest businesses were based in Auckland, it was only senior management that earned more.

The vast number of Government jobs in the capital helped to boost Wellington's average salaries.

"The Government tends to pay its employees a little bit more and I don't see a time when that will change and Aucklanders will earn more on average," Mr Manthel said.

New Zealand Immigration website, Moving to New Zealand - The Free Guide, has also just released its salary guide, based on information from job adverts, trade associations and collective agreements. The data was updated last week.

The site's independent analysts found an experienced optometrist would earn between $75,000 to $90,000 in Auckland, $85,000 to $105,000 in Wellington and $80,000 to $95,000 in Christchurch.

But whether one sector can expect a rise or not, New Zealanders will only experience a modest pay jump compared with salaries in Asia's high-growth markets.

Global management consultancy Hay Group has found New Zealand pay will rise by an average of just 3 per cent this year.

However, in less mature markets including Vietnam (12.8 per cent), Indonesia (10.6 per cent) and India salaries are expected to increase rapidly.

Business unit manager at Hay Group Simon Woolley said New Zealand organisations were facing an increasing talent threat from maturing markets in Asia and Australia.

"It is evident that Australia is doing a very good job of marketing itself to New Zealand with a record 53,700 people moving across the Ditch over the past year."

Mr Woolley said organisations needed to ensure they had reward strategies in place that deliver strong incentives to retain and attract employees despite modest pay increases.

- NZ Herald

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