Employees set for pay rises of 1% to 2.5%, finds survey

Employees of Irish firms can expect pay rises of 1% to 2.5% this year, according to Mercer’s Salary Movement Snapshot which surveyed about 150 companies.

According to the report, which surveyed Irish companies in February, 20% of businesses in the life sciences sector can expect a pay rise this year. Other sectors set for pay hikes include consumer goods (17%), hi-tech (13%), finance/banking (10%), insurance (8%), and energy (5%), said Mercer.

Noel O’Connor, senior reward consultant with Mercer, said: “Businesses in Ireland are still keeping a tight rein on salary increases.

“While private sector employment has grown modestly in recent quarters, the economic situation remains precarious and organisations remain cautious with their fixed costs, such as salaries. Our survey suggests there are some signs of movement in specific industry groups like insurance, energy, and hi-tech.”

The survey also includes responses from a range of companies in industries such as durable services, retail, and others.

The survey participants typically include local subsidiaries of multinationals and leading indigenous multinationals, it added.

The Mercer report is part of a much broader survey of 570 companies across 76 countries in Europe, the Middle East, and Africa.

The countries where wage freezes have been most common are in periphery eurozone countries, including Ireland.

However, most of the companies surveyed in this country are in the high-end multinational sector, where there is a demand for highly skilled personnel. It is these sectors that are seeing the highest level of salary increases, Mr O’Connor said.

In western Europe, the UK, Germany, Austria, Norway, and Sweden are predicting median salary budget increases of 3%.

The survey provides guidance to employers, across a range of sectors, on salary planning and salary forecasting. The data provides information from multinationals on median base pay increases across all employee groups including blue and white collar workers up to management and senior executive level, said Mercer.