Property Australia

Property salaries to increase as skills crisis worsens

PROPERTY AUSTRALIA June 14, 2022

More property professionals will be get a pay increase this fiscal year than last, as Australia’s skills crisis, the second worst in the developed world, creates a “once-in-a-career market”.

According to the Hays Salary Guide for FY 22-23, 89 per cent of property employers would raise salaries in their next review, up from 56 per cent last year.

The news comes as Australia has the second most acute labour shortages in the developed world, according to the latest OECD economic outlook, increasing calls for urgent government action to address the skills crisis.

The proportion of jobs that are vacant is at a record high, according to figures released last week by the Australian Bureau of Statistics (ABS), while unemployment rates are at levels not seen since 1974. 

In the March quarter 2022, the total number of jobs in the labour market hit 15 million for the first time, with about 3 per cent of jobs vacant.

The OECD report said while skilled immigration will rise in Australia now that the borders are open, it is not expected to be “sufficient to materially alleviate the tightness in the labour market”. 

This skills shortage is the main driver for the planned salary increases, with 67 per cent of employers in Hays Property’s survey saying it has forced them to offer higher salaries than otherwise planned. 

Of the 89 per cent planning on increasing salaries, 30 per cent intend to raise salaries by over three per cent, while 59 per cent will increase salaries by less than three per cent.

For their part, 97 per cent of the property professionals interviewed by Hays believe their performance and the demand for their abilities warrant a raise of more than three per cent.

More than two-thirds (67 per cent) think the skills scarcity has increased their confidence to ask for a raise, and 42 per cent have already profited from the skills deficit through a wage increase, a new job, or both.

Despite this, just 20 per cent are happy with their present income. Meanwhile, uncompetitive compensation is the primary motivator for 70 per cent of job searches. It rates higher than poor work-life balance and a lack of advancement chances.

“Intense competition for skilled professionals will translate into gradual salary increases this coming financial year,” said Austin Blackburne, Regional Director of Hays Property.

“Moving away from the salary stability stance of recent years, employers say the skills shortage is the reason increases are higher than planned. Already 83 per cent are experiencing a skills shortage. 63 per cent say it will impact the effective operation or growth plans of their organisation. 

“This is fuelling a once-in-a-career market. Previously camouflaged by skilled migration, and further impacted by headcount growth, skills shortages have reached a level unmatched in our years in recruitment and sparked deliberate salary increases from employers.

“However, while both the value and extent of salary increases are rising, employees’ expectations are growing faster. In a job-rich, candidate-poor market, they feel more assured of their worth and have prioritised a pay rise.”