Why A 3% Pay Rise Isn't All Bad News

PeanutsThe average growth in pay for a typical Aussie worker over the past year is under 3%. That makes careful financial planning essential, but there should be light at the end of the tunnel if you're patient.

Picture by euromagic

Figures released this week by the Melbourne Institute show that total pay growth in the 12 months to November averaged 2.9%. When the same figures were calculated in August, the number was 4.1%, suggesting that the clamps went down on pay in the second half of last year, amidst widespread fiscal panic and the descent of the GFC.

3% isn't much of a rise, but it's better than everyone seeing their wages actually fall. The study found that 57% of respondents had seen their wages rise, while 8% had seen a decline.

Back in September, we looked at a decade's worth of salary data, and calculated that salaries had gone up by an average of 5% each year. That was, however, an average figure, and the numbers have varied quite heavily each year. It looks like 2009 is one of the years when the rise won't be quite as dramatic.

One major reason why the figures are down is because the ability for workers to supplement their wages with overtime has been restricted as employers seek to cut costs. As institute fellow Dr Edda Claus pointed out in the release announcing the figures:

Overtime and penalty rates were only a minor source of pay rises over the past 12 months. This is consistent with the rise in under-employment over this past down-turn.

What's happened to your pay over the last year? Share your woes (or triumphs) in the comments.

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Comments

    Globally, my employer held salaries for management and all technical and admin staff were capped at 4.5%, that was in April 2009. Looking forward to next year, I'm guessing they might go for a 3% cap company wide.

    Has anyone accepted a pay CUT to get another job or keep your current one?

    Is it just me or does it seem a lot of companies are using the GFC as an excuse to keep pay rises at a minimum. I found out mine was a 1% rise.... lame, time to go contracting again!

    Got an increase salary this year only due to swapping jobs.

    My previous employer apparently only gave increase to roll changes and kept the majority of workers on the same wage... Not too smart me thinks.

    My employer freeze all salaries last year. lame lame.... looking forward to next year.... or maybe another job

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