Australian Salary Survey Insights for 2019
How have salaries been shaping up in the first half of 2019? If you consider wage growth, progress is slow but steady. The Australian Bureau of Statistic’s Wage Price Index rose a gentle 0.5% in the March quarter of 2019 and 2.3% since the same time last year – in fact, we’ve seen the same rate of increase for three quarters now. The strongest industries for wage growth were within health care and social assistance with a rise of 3.0%, largely thanks to scheduled rises: compared to the weakest of 1.8% for the construction industry. Western Australia saw the lowest growth in wages at 1.6%, while Victoria had the highest at 2.7%.
Of course, wage growth doesn’t exist in a bubble, and we need to consider the wider economy. In June the Reserve Bank of Australia cut the interest rate to a record low of 1.25%, while the seasonally adjusted unemployment rate remained steady at 5.2% in May 2019. This is expected to balance out relatively slow wage growth and instil consumer confidence over time, which has a flow on effect for both business and active job seekers.
Gartner’s 1Q19 Global Talent Monitor indicates that more Australian workers are feeling prepared to leave their jobs. Active job seeking increased by 5.6% in the last quarter, and employees' intent to stay fell by 8%. According to Gartner’s data, the current top driver for employees to change jobs in the current environment is whether or not they feel respected in their current role and whether they would feel more respected in a new position. Together with a more confident economy, we may well see more active job seekers and movement between positions, which is great news for organisations hoping to snag the top talent within their market.
So how are these changes affecting base salaries for top-tier roles? The below are reported Payscale averages as of June 2019:
Chief Executive Officer Mid-career CEOs with experience of 5-9 years are earning a nation-wide average of $154,292 per year. Those with 10-19 years of experience earn an average of $176,702.
Chief Financial Officer
Mid-career CFOs with experience of 5-9 years are earning a nation-wide average of $146,009 per year. Those with 10-19 years of experience earn an average of $159,214.
Mid-career Executive Directors with experience of 5-9 years are earning a nation-wide average of $130,014 per year. Those with 10-19 years of experience earn an average of $160,672.
General / Operations Manager
Mid-career General or Operations Managers with experience of 5-9 years are earning a nation-wide average of $89,787 per year. Those with 10-19 years of experience earn an average of $111,289.
Keep in mind that these figures are averaged across all Australian capital cities and a vast range of industries; in some markets salaries can fluctuate by up to 25%. CEO salaries in particular saw a significant rise in 2018, according to ACSI’s CEO Pay in ASX200 Companies July 2018 report. CEOs leading ASX100 companies saw a 12.4% salary increase and the highest bonuses since 2011, while CEOs of ASX101-200 companies saw lower yet still regular bonuses. We’ll be watching with interest for the 2019 ACSI report, as there has recently been more public awareness of bumper bonuses within the top performing companies. In late 2018 NAB and Westpac announced 30% and 25% reductions respectively to the bonus pools for their senior executives following the royal banking commission, for example. This will make it all the more important for organisations and executives to work with a recruiter who can negotiate an optimal agreement for the best talent and roles.
The construction downturn has seen thousands of job losses in the last quarter, and salaries have somewhat suffered within this industry as a result. Meanwhile industries such as public administration and safety as well as professional, scientific and technical services saw higher pay increases with the creation of new jobs in the sector. This could present opportunities for senior management talent to expand across sectors in order to access new opportunities and attractive remuneration.
There’s no way to predict with certainty how salaries will adjust in the second half of 2019, but it looks like general progress may stay on a consistent path. The RBA is predicting very slight increases to the wage price index until at least 2021, while the unemployment rate is expected to drop to 4.8% by this time in 2021. All we really know is that with so many moving parts within the various sectors, using professional recruitment services can be of invaluable help.