More procurement professionals will receive a pay rise this coming financial year than last, with skills shortages creating a “once-in-a-career market”, according to recruiting experts Hays Procurement.
The FY22-23 Hays Salary Guide, released today, found 87 per cent of procurement employers will increase salaries in their next review, up from 59 per cent last year.
- 87 per cent of procurement employers will increase salaries in their next review – up from 59 per cent;
- 17 per cent will award increases of three per cent or more;
- 65 per cent say the skills shortage has forced them to offer higher salaries than planned;
- Yet 76 per cent of procurement professionals say an increase of three per cent or more would reflect their individual performance and the demand for their skills.
Of these, 17 per cent intend to raise salaries by over three per cent, while 70 per cent will increase salaries by less than three per cent.
According to Hays Procurement, 65 per cent of employers say the skills shortage has forced them to offer higher salaries than otherwise planned.
Professionals say they deserve more
For their part, 76 per cent of the procurement professionals Hays also spoke to say their performance and the demand for their skills merits an increase greater than three per cent.
Over half (56 per cent) say the skills shortage has made them more confident to ask for a pay rise and 63 per cent have already benefited from the skills shortage through a salary increase, new job or both.
Only 32 per cent are satisfied with their current salary.
Skills shortage impacts salaries
“Intense competition for skilled professionals will translate into gradual salary increases this coming financial year,” says Tim James, Managing Director of Hays Procurement.
“Moving away from the salary stability stance of recent years, employers say the skills shortage is the reason increases are higher than planned. Already 91 per cent are experiencing a skills shortage. 74 per cent say it will impact the effective operation or growth plans of their organisation.
“This is fuelling a once-in-a-career market. Previously camouflaged by skilled migration, and further impacted by headcount growth, skills shortages have reached a level unmatched in our years in recruitment and sparked deliberate salary increases from employers.
“However, while both the value and extent of salary increases is rising, employees’ expectations are growing faster. In a job-rich, candidate-poor market, they feel more assured of their worth and have prioritised a pay rise.
“In such a market, the number one question we’re asked by employers is how to stand out as their preferred candidate’s first choice.”
Hays’s answer is a “new equation” for employers to follow. As Tim explains, “We suggest that today’s skills shortage presents an opportunity to define a new equation in the world of work. Salary increase budgets only extend so far, so consider the full value exchange for each role. Along with salary, consider benefits, upskilling, career progression, purpose, and the relationship employers have with their employees.”
Skills in demand
In other key findings, the Hays Salary Guide found:
- The top five procurement skills in demand:
- Contract Administrators
- Procurement Specialists
- Category Managers
- Contract Managers
- Procurement Managers
- Benefits increase to attract candidates: 28 per cent of procurement employers have improved benefits and working practices to entice more staff. The top three benefits sought by procurement professionals are training (either internal or external), over 20 days’ annual leave and ongoing learning & development.
- Hiring intentions rise: 54 per cent of procurement employers intend to increase permanent staff levels in FY22/23. 51 per cent will increase their use of temporary and contract staff.