Rising cost of living has led to employers increasing salaries and more likely to make counter-offers to departing staff.
More than a third (34%) of Irish-based employers claim employee salaries will increase in the next three months, according to recruitment specialist Hays Ireland.
More than half (55%) suggest these projected increases are influenced by the rising cost of living.
“Irish-based employers have responded with a range of measures, including salary increases, a renewed emphasis on fully remote roles and an unprecedented rate of counter-offering to potentially departing staff”
In the year to date, Ireland has recorded 9.6% inflation (Eurostat, July 2022) and the cost of living has placed a renewed focus on employee salaries and employee benefits, which has prompted a variety of different responses from employers looking to recruit and retain the best talent.
45% of employers claim to have provided employee pay increases in the last three months, meanwhile 55% suggest salaries have remained unchanged.
Alternative supports amid cost of living crisis
Maureen Lynch, Hays Ireland
The research suggests that many employers have moved to provide other supports to employees, outside of the traditional salary compensation.
16% of employers are providing free access to financial advisor services, eight percent are offering supermarket discounts, 6% are distributing household utility vouchers and five percent are facilitating employee loans.
“One of the key challenges to emerge in 2022 is the rising cost of living. This trend is not specific to Ireland, however, Irish inflation rates are currently running above the European average,” said Maureen Lynch, director at Hays Ireland.
She said 36% of employers plan to hire for fully remote roles; with two thirds of these employers suggesting this is an entirely new policy.
“Irish-based employers have responded with a range of measures, including salary increases, a renewed emphasis on fully remote roles and an unprecedented rate of counter-offering to potentially departing staff.
Amongst employers making new hires, one in five (21%) is currently offering signing on bonuses to new employees.
In light of ongoing talent shortages, incumbent employers are increasingly prepared to make counter offers to keep valued employees. Overall, 45% of employers sometimes make counter offers to keep staff; 42% claim to have a policy of not making counter offers in any circumstance, meanwhile the remaining 13% say they always make a counter-offer as part of their strategy of retaining staff. Nearly two in five (38%) employers say they are more likely to make counter-offers to existing employees than they were six months ago.
“Overall, the jobs market remains candidate-driven,” Lynch explained. “Despite reports of a potential economic slowdown, key industries, including banking and finance, technology, construction and engineering are continuing to hire – with many finding it tough to source talent.
“In light of this ongoing competition for the best talent, we would advise corporates to continue to re-evaluate their recruitment and retention strategies to stay ahead of the competition. What proved successful 12 months ago, may no longer be fit-for-purpose today. Those who recognise this distinction are best placed to navigate the current macro environment.”