Danger as Aussie wage gap widens

Findings show 78 per cent of Australian companies are planning to increase salaries in line with inflation. Photo / Dean Purcell

New Zealand businesses could soon find it even harder to recruit skilled staff, an international survey suggests.

Accountancy firm Grant Thornton, canvassed 430 businesses in Australia and New Zealand and found that 78 per cent of Australian companies were this year planning to increase salaries in line with inflation, or higher, compared with just 55 per cent of New Zealand ones.

The findings have renewed fears that increasing numbers of skilled New Zealanders will head across the Tasman to a healthier economy that largely out-foxed the recession.

Peter Sherwin, a partner and chairman of Grant Thornton's Wellington office, said rising salaries coupled with an increasing skill shortage in Australia should be a "call to action".

"We're going to have to be very careful to manage existing talent ... because those talented people have opportunities offshore. And what that means is, by default, we are competing in a talent marketplace which includes the salary levels paid in Australia."

Sherwin said a "serious engagement" was needed between business, universities and the state to find ways to retain skilled Kiwis at home.

"In the last few weeks we have seen two sharply contrasting pictures.

"On one hand we have had over 2000 people trying to get jobs at an Auckland supermarket, while on the other there is a growing shortage of medical graduates as they head to Australia and beyond where remuneration packages are 30 per cent higher than in New Zealand."

Employers and Manufacturers Association chief executive Alasdair Thompson said the fact that Australia's economy was performing so much better than New Zealand's automatically put Kiwi businesses in a disadvantaged position, where salary-raises were less feasible.

"The Australian economy, as far as developed countries in the world are concerned, is the best performing in the world."

The number of New Zealanders migrating to Australia fell last year as the recession took hold, but the strength of Australia's recovery has made the trip across the Ditch look attractive again.

Sherwin said there were positive signs emerging for New Zealand businesses, but "a serious handbrake" would be put on the economy if it bounced back only to find too many skilled workers had gone abroad.

"One of the four cornerstones of a business is your people within the business, and if you don't have good-quality people you're going to struggle to grow the business."

The survey found that 36 per cent of Australian companies increased staff in the past year, 27 per cent decreased, and 17 per cent made no changes.

Only 18 per cent of New Zealand firms increased staff, 41 per cent cut back and 41 per cent kept staff levels the same.

Australia v NZ

Firms planning to lift salaries*: Aust, 78 per cent; NZ, 55 per cent

Firms that increased staff: Aust, 36 per cent; NZ, 18 per cent

*In line with inflation or higher. Source: Grant Thornton