The average pay rise forecasted for next year is expected to be 2.64pc, according to the latest HR Update 2019 report from Ibec.
The report, which is one of the largest HR surveys in Ireland and which reflects the views of more than 400 senior leaders on pay and HR trends, found that 77pc of employers expect to increase pay in 2020 while 22pc expect basic pay to remain the same. Only 1pc predict a decrease.
The study found that attracting top talent remains the number one priority of HR leaders while investment in honing leadership skills continues to be critical.
“Some businesses are deferring decisions on investment due to perceived uncertainty in the economy and focusing their planning very much in the short term”
19pc of companies are planning to top-up parental leave allowances in 2020 while 20pc are preparing for gender pay gap reporting. More than 80pc of companies are maintaining a retirement age of 65.
Basic pay increases are most likely in the high-tech manufacturing sector and in manufacturing in general. Almost four out of five distribution companies (78pc) expect their basic pay rates to increase next year, while seven in ten services companies (72pc) also expect to increase basic pay.
Overall, basic pay increases are more likely in larger companies. Almost nine out of ten respondents that employ more than 250 employees expect to increase basic pay rates next year.
Two-thirds of companies with fewer than 50 employees expect to implement increases.
The majority of respondents (69pc) indicated an increase in total pay bill next year. A change in total pay bill indicates not just potential changes in basic pay rates, but additionally any increases or decreases in staff numbers. Total pay bill, therefore, includes recruitment of new staff and/or company downsizing as part of the metric.
The average increase expected is 3.45pc and the median increase is 2.5pc. This compares with 74pc of respondents in last year’s survey, who had forecast an average increase in total pay bill of 3.82pc and a median of 3pc.
“The survey tells us that whilst employers identify the need for future-proofing their organisations in anticipation of changes, there is a tendency to focus more on the immediate challenges relating to labour market skills needs and business operations over the future strategic needs of business,” explained Maeve McElwee, director of Employee Relations at Ibec.
“From our members’ feedback, we see that some businesses are deferring decisions on investment due to perceived uncertainty in the economy and focusing their planning very much in the short term.”
Written by John Kennedy (firstname.lastname@example.org)
Published: 6 November, 2019