New research from a global recruitment firm indicates that a majority of companies in the financial services industry are growing rapidly in the post-COVID recovery, but this expansion still hasn’t translated into employee wage growth.
The Hays Salary Guide for FY21-22 revealed that around 74 per cent of organisations in the banking sector, and 64 per cent of firms in accounting and finance were either in a growth or rapid growth phase following the COVID crisis, compared with an average of 63 per cent across all industries surveyed.
According to the report, 40 per cent of banking organisations now had staffing levels above what they were pre-COVID. A further 45 per cent of banking firms, 42 per cent of accounting firms and 54 per cent of insurance businesses were planning to increase their headcount in the new financial year.
However, the research indicated that tough economic conditions during the pandemic had taken their toll on industry staff, with 48 per cent of banking employees and 35 per cent of accounting and finance employees saying their overtime hours had increased in the last 12 months.
Around 64 per cent of banking industry firms also said they had undergone a restructure in the past 12 months, compared with an average of 62 per cent across all industries.
While firms were planning to expand their employee footprint, there was not much intention to reward existing staff, with the majority of financial services firms indicating they would offer a minimal pay rise in the coming 12 months.
Around 71 per cent of insurance firms said they would offer staff up to a 3 per cent pay increase, while 47 per cent of employees were expecting a raise of between 3 and 6 per cent, and 26 per cent were expecting greater than 6 per cent.
Meanwhile, 57 per cent of accounting and finance firms said they would offer an up to 3 per cent increase, while 37 per cent of employees expected a raise of between 3 and 6 per cent, and 31 per cent expected more than 6 per cent.
Similarly, 51 per cent of banking firms said they would provide a pay rise of up to 3 per cent, while 35 per cent of staff expected between 3 and 6 per cent, and 28 per cent expected more than 6 per cent.
Hays managing director for Australia and New Zealand Nick Deligiannis said that in light of the findings, there was an “urgent need” for firms to review salary packages to retain top talent, given current skills shortages related to international border closures.
Mr Deligiannis said that for cash-strapped firms, extending benefits such as flexible hours and conditions could be an alternative to significant pay rises, given employees now placed more value on such benefits after COVID.
“With the value of salary increases set to be minimal, reviewing and rolling out additional benefits can help bridge the salary expectation gap, allowing employers to reward staff when they don’t have the salary budget to do so,” he said.
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