Wages Increasing: Retention on the Rise?

Since COVID-19 first appeared, there have been rapid changes across a number of industries, some becoming almost obsolete while others experienced a boom. As we see often, when the job market changes, the ‘winning’ fields benefiting from growth tend to see wages increase as finding talent becomes increasingly difficult. When demand ramps up rapidly and supply is limited, the end result is often dubbed a ‘war on talent’ where firms compete to hire new employees, and others fight to retain them.

One of the major fields that have seen wages increase and battles for retention is the technology industry. In the wake of COVID forcing major lockdowns and city shutdowns across Australia and the world, internet offerings exploded, with traditional brick and mortar stores digitising to stay relevant. In addition, existing companies invested more heavily in their sites to ensure they could handle the new traffic quantities.

Across the tech field, in particular, we have seen a range of contributing factors for a rise in wages and consequently a change in behaviour from both firms and candidates.

Market Demand

With software testers, developers and software architects increasingly in demand, companies are recognising that hiring senior or more established workers is difficult given the number of players in the market. This has caused many of them to pivot, becoming willing to try and outpace the market demand by hiring younger talent. Not only does this give them a chance to foster and hone their skills earlier, but it also helps secure the next generation of talent. However, this creates a flow-on effect with starting salaries getting higher, meaning counter offers naturally scale up too, pushing the entire industry salary rates up into a higher bracket.

Counter Offers

Of course, having or hiring talent is only one part of the equation. Retaining them is equally important, which is where we have seen some other significant changes. Counter-offers are not necessarily rare in the tech field, but their value has also increased. Traditionally a counter-offer occurs where an employee receives another offer for a role with a new company, takes it to their current employer and gives them the chance to match (or more likely) exceed this amount to get them to stay.

But like the rise in salaries we have seen, these too have been increasing in an effort to ensure employees stay put. Where traditionally counter offer amounts may have been between $5000-$10,000, employees are seeing offers between $30,000-$35,000 one salary survey found.

Incentives

Better pay is not the only way members of the tech field are benefitting from increased demand. Employers are also offering additional incentives to retain their employees and avoid losing staff to better opportunities.

Incentives companies offer include flexible working hours, flexible working arrangements or reduced workdays. All of these have become increasingly familiar in COVID times, but now that companies are implementing these measures full time in the wake of identifying that workers remain productive and are happier with their workplace, it has become another method of retaining talent.

Visa complications

Despite the increased wages in the tech field and others, there have also been complications with the scarcity of talent to meet demands and visa complications, making it harder for companies to bring in appropriate applicants.

In some cases, visas require at least two years of work experience along with a degree, making the conditions too restrictive for young applications aged 21-23. This creates issues for companies looking to invest in younger talent, as they cannot obtain a visa to come work in Australia.

Now that international border restrictions in Australia and Queensland have eased, though, sourcing new talent may not be as difficult, with gaps becoming easier to fill.

With such a sharp increase in salary and demand in the tech field in such a short time, we will be watching this space closely to see how or even if the market will stabilise again in the future.

If your company is interested in securing visas for international candidates to fill your roles, the team at Techvisa can help. Simply contact us today to get the process started. We have a range of services that can be a benefit your business.

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