KNOW YOUR MARKET HUB

August 2018 edition

Remuneration Trends and Insights


Welcome to Mercer’s Know Your Market Hub

Bringing you the most up-to-date trends in remuneration and insights on the current rewards environment, key economic data affecting pay decisions, topical HR issues and much more! The hub is updated on a monthly basis, with the remuneration movements and forecast updated quarterly, ensuring you have access to the most current and reliable information.

In this edition we shine the spotlight on: the twin threats of aging and automation. See below to view the full article. If you have any questions, suggestions or have an interest area that you would like us to cover please take a minute to contact us.

Stay informed with our monthly Talent Talk email. We look forward to sharing the very latest trends and insights with you each month!


The Market Insights team

Got a question? Monthly Talent Talk email

QUARTERLY REMUNERATION MOVEMENTS AND FORECASTS - Q2 2018

2.5%

Movement

The median employment cost (EC) movement for same incumbents (the same people, in the same role and at the same organisations) in the general market increased slightly to 2.5% in the second quarter of 2018.

2.5%

Forecast

In Q2 2018, the projection for salary increases for the next six months has remained at 2.5%.

QUARTERLY MEDIAN SAME-INCUMBENT MOVEMENTS - BY INDUSTRY FOR Q2 2018

Market Overview - Q2 2018

The median fixed salary movement for the second quarter of 2018 was again 2.5%, which is higher than the inflation rate of 2.1% recorded by the Australian Bureau of Statistics (ABS) in June 2018.

Mercer’s pay increase barometer has seen a significant shift in the proportion of salaries being passed on at above-market rates to below-market rates. Despite both this and ongoing low wage price growth (as recorded by the ABS), the market has continued to feel optimistic about the future.

Another notable development is that pay rates for newly hired talent have outpaced packages for existing employees over the past quarter.

Download full review
PAY INCREASE BAROMETER

Pay increase barometer image


Once again, there have been no major changes to the overall composition of the pay increase barometer this month, though the proportion of below-market (contraction) increases has risen slightly to 37%, bringing it on par with the proportion of at-market (stable) increases. To find out the results by industry, click below.




More

REMUNERATION SENTIMENT INDEX

11.1%

The remuneration sentiment index score this month is 11.1%. This represents a decrease of some 14 percentage points compared to last month’s figure, but is nevertheless a high score indicating that sentiment about the remuneration and jobs market continues to be positive. Click below to find out more about how organisations perceive the remuneration and jobs market, both within their organisations and overall.





More

NEW HIRE PAY rates

1.1%

In August 2018 we continued to see an upwards trend to the overall new hire pay rates, which rose marginally to 1.1% over the previous month. This result means that the new hire pay rate has now recorded a positive figure – indicating that the market is hiring at salaries above those already in the role – for four consecutive months. To find out which industries have contributed the most to this trend, click below.


More

Gender Pay Index

2.5%

The gender pay index this month is 2.5%, which represents a marginal decrease from the July figure, and continues the downward trend we have seen over the past four months. Although the gender pay index has largely oscillated between 2.7% and 2.9% over the past year, the recent downward trend towards more equitable pay for males and females is encouraging. Which career levels, industry sectors and job roles have the largest gender pay gaps this month? Click below to find out.








More

KEY ECONOMIC INDICATORS

GDP 3.1%

(March 2018 – Seasonally adjusted (yearly)

CPI 2.1%

(June 2018 – Weighted average of eight capital cities (yearly)

WPI 2.1%

(June 2018 – Seasonally adjusted)

Unemployment 5.3%

(July 2018 – Seasonally adjusted)


Unemployment fell in July 2018 to 5.3% and is now at the lowest level in five and a half years (seasonally adjusted basis), while the Wage Price Index (WPI) and inflation (as measured by the Consumer Price Index (CPI)) remain low, both indicators recording no significant annual change. Gross Domestic Product (GDP) performed solidly and has maintained its sixth consecutive quarter of positive growth, rising to 3.1% over the 12 months to March 2018.


Source: ABS catalogues 5206.0, 6401.0, 6202.0, 6345.0





More

Spotlight

THE TWIN THREATS OF AGING AND AUTOMATION

Read this article to learn about the risks 15 countries face of rapid societal aging, and of older workers’ susceptibility to automation.

View article


GLOBAL TALENT TRENDS

Mercer's latest Global Talent Trends study reveals this year's top workforce trends.

View article


©2018 Mercer LLC, All Rights Reserved.