‘The year of the raise’: 98% of property industry employers set to hike salaries in 2023

The race for talent is on, as a new report showed an “overwhelming” number of employers in the property industry are gearing up to boost salaries in a bid to attract and retain skilled professionals.

Nearly all property industry employers or 98 per cent are planning to increase salaries in their upcoming reviews, as revealed by the latest survey by recruitment and workforce solutions specialists Hays.

These results come as no surprise considering the top factors driving turnover in the property industry, as identified by the survey, included an uncompetitive salary, lack of new challenges, and limited promotional opportunities.

Additionally, the strong intention for salary hikes among property industry employers is in line with the career priorities emphasised by real estate professionals, which include a desire for a pay rise, the ability to work flexibly, and opportunities for promotion.

“We’re calling this the year of the raise, where the promise of higher salaries reflects the intensity of the skills shortage in today’s jobs market,” senior regional director of Hays Austin Blackburne said.

Diving deeper into the findings, Hays identified the four key factors motivating real estate industry employers to increase salaries in their next review:

1. Competition amid a growing skills gap crisis

The data highlighted that a significant number of employers have deviated from their initial salary plans in response to the skills shortage, offering higher compensation to attract candidates.

Specifically, 18 percent of employers went beyond their planned salaries by a substantial margin, while 50 percent made nominally higher adjustments to their initial salary offers.

“Many employers find that the pipeline of skilled property professionals doesn’t meet their needs,” Mr Blackburne said.

Data showed the most in-demand roles in the industry were property managers, followed by lease administrators, development managers, asset managers, and property/investment analysts.

“As candidate supply continues to tighten, employers face increased pressure to proactively attract and retain talented employees,” he stated.

2. The ripple effect of falling real wages

A notable 73 per cent of employers and employees collectively acknowledge the reasonable expectation for pay raises to align with inflationary pressures.

“Employers are sensitive to the hidden cost of falling real wages on employee engagement, mental health and wellbeing, morale and job satisfaction,” Mr Blackburne said.

While he acknowledged a portion of employers can “match inflationary pressures”, he pointed out this segment is also “stretching their salary increase budget as far as they can to support their staff”.  

3. The impact of pay transparency

Findings showed a significant portion of employers are transparent with employees about how salary levels and increases are set to improve fairness and build trust.

Data showed 19 per cent of employers in the industry said they are transparent with all employees and 31 per cent with select employees.

“We expect these figures to rise in the months ahead, with the abolition of pay secrecy in Australia prompting more employers to audit salaries, scrutinise disparities, and make adjustments when required to ensure fair and equal pay,” Mr Blackburne stated.

Notably, 43 per cent of employers said they do not disclose salary levels and increases.

4. The rise of ‘the great ask’

Survey results showed an increasing number of property professionals are looking to assert their bargaining power, with 65 per cent planning to request pay raises this year, a notable increase from 58 per cent in the previous year and 45 per cent in the year prior.

“Employees still feel they have bargaining power and are more confident to negotiate for better pay,” Mr Blackburne noted.

Almost one in four or 23 per cent said they have no plans to request a salary raise this year, while 12 per cent said they are unsure whether they will ask for a wage hike.

How can employers and employees navigate the current labour market?

Employers are placing significant emphasis on their recruitment and salary plans and are recognising the importance of investing in their workforce for success, according to Mr Blackburne.

However, he said the race for talent can’t be won by salary alone. With that, he advised businesses to also review their benefits package.

“Consider what else you can offer to attract and retain talent, such as opportunities for growth, wellbeing days, additional annual leave, improved recognition, work-life balance or a more positive work environment.”

Findings showed the top benefits property industry employers are prioritising this year include training (either internal or external), mental and physical health and wellbeing programs, as well as creating pathways for career progression opportunities.

And although Mr Blackburne acknowledged that employees still have the “bargaining power” amid the strong demand for skilled property professionals, he underlined “it’s important to temper it to avoid pricing yourself out of consideration.”

“Yes, employers are investing in salary increases, but margins remain tight. The commercial reality dictates that salary increases can only stretch so far.”

“Consider the whole package when you negotiate a new job or your next pay rise. Benefits can go a long way to bridging a possible financial expectation gap, so think about what you’d really value and what could make a difference to your life and career long-term,” Mr Blackburne advised.