Tech worker pay set to rise this year and next

Despite a tightening economy, the vast majority of technology employers are looking to moderately increase salaries, a survey suggests.

Hays Salary Guide which is based on a survey of over 14,000 employers and professionals by the recruitment company indicated that two-thirds of employers would increase salaries by more than three percent.

However, most of these, 49 per cent of employers, planned to keep pay rises in the three to six per cent band; the March headline inflation figure jumped to 6.8 per cent in Australia.

Only 12 per cent of employers are looking at salary increases in the 7 to 10 per cent band, and just five per cent indicated they're willing to pay more than 10 per cent, the Hays survey found.

Hays managing director Adam Shapley said that 81 per cent of employers and employees combined believe it's reasonable to expect pay rises to keep up with inflation.

“Employers are sensitive to the hidden cost of falling real wages on employee engagement, mental health and wellbeing, morale and job satisfaction,” he said.

“While few employers can match inflationary pressures, they are stretching their salary increase budget as far as they can to support their staff,” Shapley said.

Beyond inflationary pressures, Hays pointed to a growing skills gap crisis as a salary increase driver.

Employees also feel more confident this year in their bargaining power, with the majority, 70 per cent, planning to ask for a pay rise.

Abolition of pay secrecy in favour of remuneration transparency is another driver for pay increases.

Tech workers in general are unhappy with the level of pay in Australia.

“Despite the increased salary boost, employer and employee expectations in technology still fail to align," Shapley said.

"Many tech professionals feel undervalued and underpaid."

"They feel their current salary doesn’t reflect their individual performance," Shapley added.

Hays' advice to employers is that investing in their workforces through salary increases and upskilling is key to success.

Employers should review the benefits they offer, and consider what else they could add to them such as opportunities for growth, wellbeing days, additional annual leave, improved recognition, work-life balance and a more positive work environment.

Tech professionals meanwhile are advised to temper their expectations to avoid being priced out of consideration, despite their bargaining power due to skills demand.

Looking at the entire remuneration package, in which benefits can go a long way to bridge a perceived financial expectation gap could make a difference to workers' lives and career long-term, Hays advised.

Hays found that the top factors driving staff turnover were lack of promotional opportunites, followed by an uncompetitive salary, poor management style, or workplace culture.