Most Aussie workers believe their employers are in a strong financial position to dish out pay rises, but low wage growth suggests businesses aren’t being transparent about their true financial situation.
Global recruitment firm Randstad’s latest Workmonitor report suggested 57 per cent of workers actively anticipate a pay rise by the end of the current financial year.
Even more, 65 per cent believed their employer achieved strong financial results in 2017, and 70 per cent expect an even better year in 2018.
“In line with this, employers across the board need to address how they can share some of their financial success with staff and either retain or attract new talent,” said Randstad Australia CEO Frank Ribuot.
“Businesses need to take the lead, working hand-in-hand with policy makers and employees to raise the bar. To meet the expectations of Aussie workers in 2018, upskilling, training incentives, a genuine employer value proposition and remuneration clearly should be put at the heart of engagement and retention strategies. This will ultimately help them to attract and retain the best talent, yielding stronger business results.”
However, the results sit in contrast with current wage growth figures, which are tracking below inflation for full-time workers, meaning pay rates are actually falling, suggesting the fortunes of many businesses aren’t so rosy as workers believe.
For example, a My Business straw poll conducted in October last year found that two-thirds of respondents were not expecting Christmas trade to be higher in 2017 than the previous year.
Meanwhile a separate poll conducted two months earlier asked My Business readers: “With concerns mounting about wage stagnation, are you planning to give employees a pay rise this financial?”, to which close to half replied they would be giving either no increase or even cutting wages.
“SMEs don’t limit pay rises with pleasure as they know it plays a big role in their staff engagement. They do so because their profits are squeezed,” one reader commented.
The cause of these divergent views on business profitability could be, at least in part, poor transparency between employers and their workers.
Speaking at a small business event recently at the Microsoft Store in Sydney, Levi Aron – Australian country manager at Deliveroo – suggested that all business leaders like to think of themselves as transparent, but many are less so in practice.
According to Mr Aron, transparency is a journey that business owners take with their employees, one which builds over time as trust develops between the parties.
Confidentiality frameworks are required for employers to have full transparency of sensitive business figures with their workforce, parameters for which can be set in place from the outset.
He suggested that by openly engaging with staff, and showing profit and loss figures, growth trajectories and concerns, conversations are able to be opened with employees and makes the various teams more accountable to themselves as well as to each other.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.
- Australian manufacturers can create their own stimulus
- Here’s what separates success from the rest
By Adam Zuchetti
- 5 workplace trends to watch in 2020
By Nicole Gorton