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 How to get ahead of the domino effect of inflation-based salary increases
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How to get ahead of the domino effect of inflation-based salary increases

Posted on 08 September 2022

I have noticed a significant change in salary expectations across Payroll and Accounting Support roles in the last 6 months.

While most industries were heavily impacted by Payroll and Accounting Support job losses at various points during 2020 and 2021, particularly hospitality and food services and Arts and recreation, most industries had returned to pre-pandemic levels of demand.

New pressures

There is a significant uplift in talent leaving NSW for sea and tree changes and the seasonal demands of both the NT and QLD. This upwards trend in demand, the shortage of local talent and the increased cost of living have put significant pressure on pay negotiations. Most of our payroll and accounting support candidates are now looking for around 10% more than they were 6 months ago.

Understandably inflation is the main concern now. For the first time in memory, inflation is the main reason for a change of role.

Equal new expectations

Many people don’t want to leave their current job but feel it is the only option to address the rising cost of living. In our end of the market, a 10% increase in base income can make a huge difference to lifestyle and living affordability.

Average salary expectations for Payroll Officers are now around $75k, with Accounting Support and Junior Accounts people looking for around $75-80k plus super and Accountants $80-85k.

So what can employers do to manage this trend?

Pre-emptive communication: Many candidates we speak to are keen to test the market and use this information as the basis of a conversation with managers about pay increases. However, those negotiations often lead to the end of the relationship with the individual deciding it’s time to move on, increase income and try to offset some of the spiral costs of living that we are all experiencing.

It is vital that lines of communication are open and well-established to avoid losing people in this way.

Regular reviews: Performance and remuneration reviews are the optimal way to ensure consistent communication. You wouldn’t want the first conversation about money to happen when accompanied by a resignation letter. Statistics show it’s too late for both parties at that stage.

Offering relevant incentives: If you are unable to be flexible on remuneration, then consider the other things you can offer that have value.

  • Work-life balance now seems to be the central request with 1 or 2 days at home, so this is no longer a “perk” but is a prerequisite.

  • Job share, flexible hours, work creche options and/or other family and lifestyle benefits are a strong plus in this market.

  • Training seems to be the other big agenda item, which can enable a win-win outcome and offsets some salary increases, so consider what training can be offered to help Payroll or Accounting Support specialists to develop.  

This is very much a key criterion for candidates in the market now and many are willing to consider dropping salary expectations in return for flexibility and development.

For further advice on hiring and retaining accounting roles, you can arrange a chat with a member of the team here.

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