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Salaries to Remain Static in Construction Despite Levels of Employment


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Despite buoyancy in the construction sector across most states, salaries have remained static and look set to remain so, according to the latest Hays Salary Guide.  

The survey found that in the last round of salary reviews, almost 60 per cent of employers in the construction sector awarded less than 3 per cent wage increase, with 15 per cent of those awarding no increase at all. 

The figures for the next round of salary reviews are only slightly more encouraging with 54 per cent of employers intending to increase salaries by less than 3 per cent and 12 per cent of employers proposing no increase at all. 

It is not all doom and gloom though, with 25 per cent of construction, property and engineering employers intend to increase salaries by 3-6 per cent, and 9 per cent of the property and engineering employers propose increases between 6 and 10 plus per cent.

The lacklustre projections for salary increases come despite enormous activity in the level of houses and apartments being built on the East Coast, which continues to create high demand for staff across across all trades and disciplines. Construction staff numbers have grown by a massive 8.9 per cent over the last two years, but this hasn’t lead to any significant increases in remuneration.

Australian Bureau of Statistics data reveals that average salary increases in the construction sector (to November 2016) was only 1.7 per cent or $26.80  (average male full-time earnings.) 

In an interview, Senior Regional Director of Hays Construction Simon Bristow attributed the slow growth in salaries to a competitive market environment: 'I think it has something to do with the lower growth in output prices and a more competitive market where many employers are vying for jobs and so keeping margins tight'.

'I also think that companies are taking a firmer stance in keeping salaries in check, post GFC, and this is having an impact”, he concluded.

Bristow highlighted some employers are paying bonuses on project completion, however it doesn’t seem to have done much retain workers, with the industry reporting an increase of 32 per cent in voluntary staff turnover.  It seems that with the numerous large projects underway, construction employees are willing to leave roles in search of better opportunities.

The Hays Salary Guide 2017 indicates that  salary increases across the wider Australian workforce are also sluggish with 65 per cent of employers overall saying they will give staff an increase of up to 3 per cent, while 11 per cent of employers will not award any increase. 

The IT and Telecommunications Industry was recorded as the most generous for a salary increase with 20 per cent of employers intending to give increases upwards of 6 per cent. The Advertising and Media industry also rated highly with 16 per cent of employers intending to give a raise above 6 per cent.

Interestingly while 15 per cent of employees (across the board) who asked for a pay rise were declined, 17 per cent of those who asked were successful. In light of these results, perhaps it is unsurprising that 45 per cent of employees intend to ask their employers for a pay rise in their next review.

The Hays Salary Guide is based on a survey of more than 2,950 organisations representing 3,021,984 employees nationally.   

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