Nearly two-thirds of employers in the Australian financial services sector are looking to give pay rises at the lower end, while the number of bosses looking to give increases higher than 6 per cent has fallen, according to new research.
The Hays Salary Guide found 63 per cent of financial services employers are intending to raise their staff’s salaries by 3 per cent of less this year, up from 58 per cent who did so in their last review, according to a new guide.
At the higher end of the wage scale, 4 per cent of employers, down from 10 per cent, were said to intend to grant pay increases of more than 6 per cent.
However, more than half (57 per cent) of employees say a salary increase is their top priority this year.
Around 46 per cent of professionals intend to achieve this by asking for a pay rise, while others are looking elsewhere. The report noted 41 per cent of jobseekers in the industry said their current uncompetitive salary provoked their search.
More than a quarter (28 per cent) of financial services professionals were reported to expect no increase, while a further 31 per cent expect rises of 3 per cent or less.
The survey showed 91 per cent of financial services industry employers will increase salaries in their next review, slightly down from 92 per cent who did so in their last review.
“On the one hand, we have professionals telling us they’ve prioritised a pay rise and are prepared to enter the job market to improve their earnings,” Carl Piesse, regional director, Hays Banking said.
“On the other, employers tell us they want to add to their headcount and are being impacted by skill shortages, yet they plan to curtail salary increases.”
Hays expects a spike in demand for risk and compliance professionals following the royal commission, with institutions needing to effectively assess and monitor risk and compliance. Consequentially, it said, salaries in the space should also rise in the next year.
New qualifications in financial planning will see a large number of advisers exit the industry, the recruiter added, leaving a gap and raising demand for highly qualified advisers.
“Remuneration structures may also change, with base salaries increasing at the expense of commissions,” Mr Piesse said.
“The continued movement of financial planners and paraplanners to remediation projects related to the royal commission will further add to the shortage of suitable candidates and, in turn, will impact salaries across the board.”
The survey found 70 per cent of employers believe skill shortages will impact the effective operation of their business or department in either a significant (28 per cent) or minor (42 per cent) way, up from 62 per cent the year before.
Over half of employers, 54 per cent, reported they were restructuring to keep up with changing business needs, with the key driver for change being different required skill sets.
The majority or 68 per cent of financial services firms said business activity had increased over the past year, with 70 per cent saying they expect it to rise in the coming 12 months. Reflecting this, nearly half (47 percent) said they intend to increase permanent staff levels over the coming year.
In skill-short areas, 57 per cent of employers said they would consider hiring or sponsoring a qualified overseas candidate.
Flexible work practices were seen to be the most common non-financial benefit offered, by 83 per cent of employers, ahead of ongoing learning and development (70 per cent) and career progression opportunities (62 per cent).
Around two-thirds, or 67 per cent of organisations offer flexible salary packaging.
The most common benefit, the report said, is salary sacrifice, offered by 55 per cent of employers to all employees, followed by mandatory superannuation (offered by 37 per cent of businesses), parking (33 per cent), bonuses (27 per cent) and private health insurance (26 per cent).
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
Sarah has a dual bachelor's degree in science and journalism from the University of Queensland.
You can contact her on [email protected].
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