2015: Year of the salary hike?
Paul O'Donoghue looks at which sectors are in line to gain this year
Well, it's official. Austerity is over, and according to Michael Noonan, it has been for the past 12 months. Hallelujah!
However, despite much being made of rising GDP and GNP figures, the economic recovery has remained an abstract concept to many. While talk about reduced government bond borrowing costs is all well and good, often a recovery is difficult to feel until workers start seeing a bump in their pay packet.
If you're in the high tech, insurance or financial services sectors, you're in luck, as judging from the latest data from human resources firm Mercer all three are in line for increases in pay of between 2pc and 3pc.
On the other hand, despite some notable wins on pay increases in several large companies, pay in several sectors, most notably retail, is set to stay flat for the year. With that said, coming into 2015 it seems that if you aren't expecting a pay rise you are the exception, not the rule.
After years of being beaten down by relentless austerity and bleak news on the economy, many employees are finally in a position where at least the notion of a pay rise no longer seems like a pipe dream.
A survey from Irishjobs.ie showed that seven out of ten workers plan on looking for a pay rise in 2015, while according to a recent IBEC study, up to 57pc of companies are prepared to increase wages, with just 1pc budgeting for a decrease.
So, who are in line for pay rises? Well, the aforementioned tech and financial services are virtually nailed on due to high demand for skilled employees, allowing them to command a higher wage.
Those with the gift of the gab are in luck, as employment agency Brightwater is forecasting earnings in sales to jump by between 5pc and 10pc, while solicitors, accountants and those in electronics and telecoms are all set to see bumps in their pay packet of between 2pc and 5pc.
Despite predicted stagnant salaries in 2015, several retail employees saw modest bumps in the previous 24 months, with the Mandate trade union claiming that it has managed to secure pay rises of 3pc in companies such as Argos, Pennys and Dunnes Stores.
While it has been mostly good news across the board, there are sectors and employers who continue to struggle. Pay in publishing is set to stay flat, while Teagasc, the State Agriculture and Food Development Authority, has predicted that dairy farmers are to see their average salaries cut in half, from €60,000 to €30,000, due to a global oversupply of milk.
Taoiseach Enda Kenny also recently appeared to pour cold water on the idea of wage increases in the public sector, saying: "The Haddington Road Agreement runs until 2016 and it's important that we don't spend away all of the hard-won gains".
However, a hike in the minimum wage looks to be on the cards. Before Christmas, Minister for Business Ged Nash said that 2015 would be the year of the pay increase, and added that he wants to see an increase in the national minimum wage and set up a new body to examine the minimum wage.
Labour now looks set to push for a hike in the minimum wage and it is not alone, with SIPTU calling for the base level to be set at a "living wage" of €11.45 an hour. Business groups such as IBEC and the Irish Small and Medium Enterprises Association have been more resistant to wage hikes, citing competitiveness concerns.
Director with recruitment firm CPL Peter Cosgrove, while not against a hike in the minimum wage, says that there are alternative policies that firms can implement instead of blanket pay increases. "There are lots of things that employers can do besides giving pay increases," he said.
"Measures such as two extra holiday days, sick day pay or a bonus scheme can be better than giving cost increases across the board."
Regarding the pay increases that many companies look set to bring in at some stage before the year is out, Mr Cosgrove said: "I think that the pain has already happened where it will happen, companies that knew [that they would have to reduce pay] did so quickly rather than deaths by a thousand cuts.
Asked which jobs are likely to see some extra money at the end of the month, Mr Cosgrove readily identifies IT, linguistics and healthcare, but adds that many employers are now choosing to implement performance-related pay bonuses rather than pay hikes across the board. He argues that this is actually a better way of motivating employees and says that it makes more sense for both the worker and the employer.
"The way that people look for pay rises is changing. Now what many companies do is try and incentivise bonuses. Once you give a pay rise it's there forever, but with bonuses if you perform well and you get the bonus which is the equivalent of a pay rise for that year, it makes more sense and it gets results."
Sunday Indo Business