1 00:00:03,840 --> 00:00:06,300 Sean Aylmer: Welcome to the Fear and Greed business interview. I'm Sean 2 00:00:06,390 --> 00:00:10,320 Sean Aylmer: Aylmer. Anyone hoping for a big salary bump in 2024 3 00:00:10,320 --> 00:00:13,680 Sean Aylmer: could be out of luck, even with unemployment so low, 4 00:00:14,040 --> 00:00:17,639 Sean Aylmer: most employers are not expecting to offer salary increases above 5 00:00:17,639 --> 00:00:21,180 Sean Aylmer: inflation. It's one of the key findings from the 2024 6 00:00:21,180 --> 00:00:25,860 Sean Aylmer: Salary Survey by global recruitment consultancy, Robert Walters. Shay Peters 7 00:00:25,920 --> 00:00:29,160 Sean Aylmer: is the Chief Executive Officer of Robert Walters Australia and 8 00:00:29,190 --> 00:00:31,260 Sean Aylmer: New Zealand. Shay, welcome to Fear and Greed. 9 00:00:31,740 --> 00:00:32,910 Shay Peters: Hi, it's good to be here. 10 00:00:33,570 --> 00:00:38,790 Sean Aylmer: Okay, so 58% of employers in Australia and New Zealand aren't expecting 11 00:00:38,790 --> 00:00:42,989 Sean Aylmer: to go above inflation for their salary increases. I suppose 12 00:00:43,050 --> 00:00:46,708 Sean Aylmer: inflation is pretty high. Is this good news for workers, 13 00:00:46,710 --> 00:00:48,449 Sean Aylmer: bad news for workers? Where do they stand? 14 00:00:49,440 --> 00:00:54,479 Shay Peters: Look, I think overall it's probably not great news. I 15 00:00:54,480 --> 00:00:58,320 Shay Peters: think that we've talked about in previous years, a real 16 00:00:58,320 --> 00:01:00,360 Shay Peters: terms trauma and I think this is coming to effect 17 00:01:00,360 --> 00:01:05,819 Shay Peters: now. And that's when your salary increase is unlikely to 18 00:01:05,819 --> 00:01:09,270 Shay Peters: meet CPI or the cost of living increase, and therefore you're 19 00:01:09,270 --> 00:01:13,020 Shay Peters: actually taking probably a real terms pay cut. So it's 20 00:01:13,020 --> 00:01:16,050 Shay Peters: going to be a tough grind I think in 2024 21 00:01:16,380 --> 00:01:18,990 Shay Peters: as we look ahead. One of the major factors that 22 00:01:18,990 --> 00:01:22,949 Shay Peters: we're seeing at the moment is revenue lines for organizations 23 00:01:22,950 --> 00:01:27,030 Shay Peters: seem to be pretty flat, but their costs are increasing 24 00:01:27,089 --> 00:01:30,119 Shay Peters: year on year. And so trying to keep up with 25 00:01:30,270 --> 00:01:33,869 Shay Peters: CPI or cost of living salary increases is unlikely to 26 00:01:33,990 --> 00:01:35,279 Shay Peters: be sustainable for next year. 27 00:01:35,910 --> 00:01:38,939 Sean Aylmer: Okay. So you're in the business of recruiting and ensuring 28 00:01:38,940 --> 00:01:42,659 Sean Aylmer: people are placed in the right jobs, etc. Do you 29 00:01:42,660 --> 00:01:46,080 Sean Aylmer: think you are going to get busier then? Because people 30 00:01:46,080 --> 00:01:49,830 Sean Aylmer: will start moving jobs because their expectations around salary aren't 31 00:01:49,830 --> 00:01:52,050 Sean Aylmer: quite what they have been the last couple of years. 32 00:01:53,160 --> 00:01:55,650 Shay Peters: That's a really tough one. So we're in an interesting 33 00:01:55,650 --> 00:01:59,040 Shay Peters: dynamic at the moment with unemployment still really low. But 34 00:01:59,040 --> 00:02:00,599 Shay Peters: what I think we're going to see and what we've 35 00:02:00,599 --> 00:02:04,589 Shay Peters: seen come through the data and the Salary Survey that we've just launched, 36 00:02:04,590 --> 00:02:08,700 Shay Peters: is that job security is actually moved back into one 37 00:02:08,700 --> 00:02:11,940 Shay Peters: of the highest priorities for workers. So that might mean 38 00:02:11,940 --> 00:02:14,220 Shay Peters: that we see a bit of a stagnation in the 39 00:02:14,220 --> 00:02:17,638 Shay Peters: labor market next year. However, there will be some workers 40 00:02:17,639 --> 00:02:21,690 Shay Peters: in various industries that haven't been able to get a salary 41 00:02:21,690 --> 00:02:24,780 Shay Peters: increase where they are. So they may look laterally at 42 00:02:24,780 --> 00:02:28,798 Shay Peters: opportunities where there is a potential opportunity at a more significant 43 00:02:28,800 --> 00:02:31,620 Shay Peters: pay rise. It's just a funny dynamic and we haven't 44 00:02:31,620 --> 00:02:35,940 Shay Peters: really seen this type of market before with the stagnation 45 00:02:35,940 --> 00:02:38,668 Shay Peters: of salaries, but also really low unemployment. 46 00:02:39,809 --> 00:02:41,759 Sean Aylmer: Okay. I want to get to where you might be 47 00:02:41,760 --> 00:02:45,480 Sean Aylmer: able to find higher wages in a moment, but just 48 00:02:45,780 --> 00:02:47,850 Sean Aylmer: give me a little history lesson. So the last couple 49 00:02:47,850 --> 00:02:50,399 Sean Aylmer: of years, job security hasn't been at the top of 50 00:02:50,400 --> 00:02:52,169 Sean Aylmer: the list. Is that what you're inferring? 51 00:02:52,440 --> 00:02:54,809 Shay Peters: No. Job security certainly hasn't been, because it's been a 52 00:02:54,809 --> 00:02:58,799 Shay Peters: boom labor market where the supply has definitely not been 53 00:02:58,799 --> 00:03:02,340 Shay Peters: able to match demand and therefore workers have been very, 54 00:03:02,370 --> 00:03:06,840 Shay Peters: very confident about securing another gig looking elsewhere. And employers 55 00:03:07,050 --> 00:03:09,659 Shay Peters: have been trying to lure a number of employees away 56 00:03:09,660 --> 00:03:13,709 Shay Peters: through headhunting or using intermediaries to ensure that they're matching 57 00:03:13,710 --> 00:03:17,609 Shay Peters: productivity gains that they can foresee. The biggest frustration across 58 00:03:17,609 --> 00:03:20,310 Shay Peters: Australia and New Zealand for all employers is that they're 59 00:03:20,310 --> 00:03:24,300 Shay Peters: not actually able to meet the productivity levels that they 60 00:03:24,300 --> 00:03:26,669 Shay Peters: believe their business can reach if they had, I guess, 61 00:03:26,669 --> 00:03:27,420 Shay Peters: better labor flow. 62 00:03:27,990 --> 00:03:33,359 Sean Aylmer: Okay. So there will be some wage increases presumably. What 63 00:03:33,360 --> 00:03:37,560 Sean Aylmer: sectors, what roles are more likely to offer higher wages? 64 00:03:38,100 --> 00:03:40,410 Shay Peters: So the data shows that I think in the wealth 65 00:03:40,410 --> 00:03:44,520 Shay Peters: management space, which it's a highly sought- after area for 66 00:03:44,520 --> 00:03:48,150 Shay Peters: high caliber individuals, individuals that are really at the top 67 00:03:48,150 --> 00:03:52,020 Shay Peters: of their game, there's still an opportunity in that space 68 00:03:52,020 --> 00:03:56,070 Shay Peters: for employees to try and get salary increases above what 69 00:03:56,070 --> 00:04:00,240 Shay Peters: CPI would look like. Also, we've seen there's certain pockets 70 00:04:00,240 --> 00:04:03,780 Shay Peters: in the tech and transformation industry, with people with that 71 00:04:03,780 --> 00:04:06,509 Shay Peters: type of skill set where there is an opportunity for 72 00:04:06,509 --> 00:04:08,700 Shay Peters: them to get a pay rise above CPI as well. 73 00:04:08,700 --> 00:04:12,570 Shay Peters: They're still highly, highly sought after in really specialist areas. 74 00:04:13,020 --> 00:04:15,480 Shay Peters: And then you're looking at things like, I mean, obviously 75 00:04:15,480 --> 00:04:18,600 Shay Peters: the cost of living crisis is also hitting businesses and 76 00:04:18,600 --> 00:04:22,830 Shay Peters: so organizations are trying to ensure that they've got highly 77 00:04:22,830 --> 00:04:26,700 Shay Peters: qualified credit controllers in place to ensure that they are 78 00:04:27,120 --> 00:04:29,938 Shay Peters: getting all of their bills and invoices paid. 79 00:04:30,330 --> 00:04:32,460 Sean Aylmer: Okay. What about the opposite side? The sectors where salaries 80 00:04:32,460 --> 00:04:34,080 Sean Aylmer: certainly won't keep up with inflation. 81 00:04:35,190 --> 00:04:36,480 Shay Peters: Almost everything else. 82 00:04:36,870 --> 00:04:39,419 Sean Aylmer: Right. Think anything. Ah, Shay, come on, pick it up. 83 00:04:39,420 --> 00:04:41,460 Sean Aylmer: We need some good new, it's Christmas, no? 84 00:04:41,490 --> 00:04:45,178 Shay Peters: Yeah. If look at the salary increases over the past two 85 00:04:45,178 --> 00:04:50,039 Shay Peters: years, they've been significant and organizations simply can't keep that 86 00:04:50,040 --> 00:04:53,190 Shay Peters: going, it's unsustainable. If you looked at a three- year 87 00:04:53,190 --> 00:04:56,428 Shay Peters: cycle in terms of pay rises, I still think people 88 00:04:56,428 --> 00:04:59,580 Shay Peters: will be getting above CPI, but I think it's 2024 89 00:04:59,969 --> 00:05:02,309 Shay Peters: as it might just not reach there. I think a 90 00:05:02,309 --> 00:05:05,189 Shay Peters: lot of organizations are not going to get quite up 91 00:05:05,190 --> 00:05:07,979 Shay Peters: to that level. I think most employees will still get 92 00:05:07,980 --> 00:05:10,979 Shay Peters: a pay rise, but like I said, it might not 93 00:05:10,980 --> 00:05:12,450 Shay Peters: match the cost of living increase. 94 00:05:13,080 --> 00:05:14,820 Sean Aylmer: Stay with me Shay, we'll be back in a minute. 95 00:05:21,270 --> 00:05:24,750 Sean Aylmer: I'm speaking to Shay Peters, CEO of Robert Walters Australia 96 00:05:24,750 --> 00:05:29,640 Sean Aylmer: and New Zealand. Let's go beyond remuneration, because I think 97 00:05:29,640 --> 00:05:32,160 Sean Aylmer: what Covid taught us was that many of us like 98 00:05:32,370 --> 00:05:36,359 Sean Aylmer: working from home or in hybrid arrangements, what about that? 99 00:05:36,750 --> 00:05:40,440 Sean Aylmer: Is this going to be a battleground between employers and 100 00:05:40,440 --> 00:05:42,960 Sean Aylmer: employees in the next few years? It just seems that 101 00:05:42,960 --> 00:05:45,330 Sean Aylmer: we're kind of seeing it a little bit already. 102 00:05:45,720 --> 00:05:49,200 Shay Peters: Yeah, I think employers are actually starting to gain a little 103 00:05:49,200 --> 00:05:54,539 Shay Peters: bit more control in that employment relationship dynamic and therefore 104 00:05:54,540 --> 00:05:56,820 Shay Peters: they're able to be a little bit more demanding on 105 00:05:57,029 --> 00:05:59,308 Shay Peters: when they want to see their employees in the office. I 106 00:05:59,309 --> 00:06:03,029 Shay Peters: think all employers fully appreciate the need for flexible working, 107 00:06:03,029 --> 00:06:06,180 Shay Peters: so I don't think flexible working is going away, but 108 00:06:06,180 --> 00:06:08,250 Shay Peters: what I think we're going to get to is a 109 00:06:08,250 --> 00:06:12,779 Shay Peters: middle ground where both employees and employers understand that there's certain 110 00:06:12,779 --> 00:06:16,350 Shay Peters: times where employees need to be in their office to maximize 111 00:06:16,350 --> 00:06:21,750 Shay Peters: productivity and innovation. Without present sometimes collaboration is hard to 112 00:06:21,750 --> 00:06:25,770 Shay Peters: achieve and therefore innovation is probably something that falls by 113 00:06:25,770 --> 00:06:28,890 Shay Peters: the wayside where people are brainstorming. So I think that 114 00:06:29,190 --> 00:06:32,549 Shay Peters: the dynamic and there is a power shift coming into 115 00:06:32,549 --> 00:06:36,359 Shay Peters: play here, and also employees are probably wanting to be 116 00:06:36,359 --> 00:06:39,870 Shay Peters: seen more in the office as job security is going to be 117 00:06:39,870 --> 00:06:42,479 Shay Peters: one of their number one factors over the next 12 118 00:06:42,480 --> 00:06:46,620 Shay Peters: months. Being seen and being present I think is going 119 00:06:46,620 --> 00:06:49,170 Shay Peters: to be advantageous for employees and I think they understand that. 120 00:06:49,678 --> 00:06:51,238 Sean Aylmer: Surely we're not going to get back to where we 121 00:06:51,240 --> 00:06:51,750 Sean Aylmer: were though. 122 00:06:52,260 --> 00:06:55,230 Shay Peters: No, I think that the days are gone where a five- 123 00:06:55,230 --> 00:06:58,290 Shay Peters: day working week in the office is the norm. I 124 00:06:58,290 --> 00:07:00,450 Shay Peters: simply don't think that's going to be the case. I 125 00:07:00,450 --> 00:07:04,290 Shay Peters: think employers understand the need for flexible working. I think 126 00:07:04,290 --> 00:07:07,409 Shay Peters: they can see it helps the well- being of their 127 00:07:07,410 --> 00:07:13,260 Shay Peters: employees, it allows employees to maximize what I would probably 128 00:07:13,260 --> 00:07:17,940 Shay Peters: classify as their holistic or their life as opposed to 129 00:07:17,940 --> 00:07:20,849 Shay Peters: just their professional life. So there's a nice marrying of 130 00:07:20,849 --> 00:07:23,429 Shay Peters: personal and professional life when you are able to work 131 00:07:23,429 --> 00:07:25,799 Shay Peters: from home every now and then. So I think that's here to stay, I don't think that's 132 00:07:27,450 --> 00:07:32,760 Shay Peters: going anywhere. We're seeing some organizations globally try and mandate five- 133 00:07:32,760 --> 00:07:36,180 Shay Peters: day working weeks, but I can't see that being a 134 00:07:36,180 --> 00:07:37,440 Shay Peters: reality across ANZ. 135 00:07:38,940 --> 00:07:41,550 Sean Aylmer: Shay, I'm a few years older than you, decades probably, 136 00:07:42,179 --> 00:07:43,650 Sean Aylmer: but I tell you what, the idea of going back 137 00:07:43,650 --> 00:07:46,440 Sean Aylmer: to how I worked when I was 25 or 30 is just 138 00:07:46,590 --> 00:07:48,421 Sean Aylmer: horrendous and I don't think anyone should have to do that. 139 00:07:48,421 --> 00:07:48,422 Shay Peters: No. 140 00:07:48,422 --> 00:07:52,230 Sean Aylmer: What about AI? That's something I didn't ever worry about, nowadays 141 00:07:52,230 --> 00:07:54,720 Sean Aylmer: I probably worry about a little bit. Will we start 142 00:07:54,720 --> 00:07:58,770 Sean Aylmer: to see artificial intelligence affecting roles, productivity and therefore salaries? 143 00:07:59,759 --> 00:08:02,639 Shay Peters: AI is definitely going to be a factor over the 144 00:08:02,639 --> 00:08:05,009 Shay Peters: next two or three years. I think we're already seeing 145 00:08:05,100 --> 00:08:08,010 Shay Peters: AI being used by a number of organizations to try 146 00:08:08,010 --> 00:08:11,340 Shay Peters: and reach productivity gains where they might've had skill set 147 00:08:11,340 --> 00:08:15,630 Shay Peters: gaps and where they might've had labor gaps. So AI 148 00:08:15,630 --> 00:08:17,160 Shay Peters: is going to take a place, I think what we 149 00:08:17,160 --> 00:08:20,910 Shay Peters: are seeing is organizations being smart around how they utilize 150 00:08:20,910 --> 00:08:24,510 Shay Peters: their resources, and so they want high- value tasks being 151 00:08:24,510 --> 00:08:27,060 Shay Peters: done by high- value resources. They don't want low- value 152 00:08:27,060 --> 00:08:30,960 Shay Peters: tasks being done by high- value resources. And so AI 153 00:08:30,960 --> 00:08:33,750 Shay Peters: definitely plays a part there and so does the potential 154 00:08:33,750 --> 00:08:37,770 Shay Peters: for outsourcing as well. That's another opportunity for organizations to 155 00:08:37,770 --> 00:08:40,859 Shay Peters: have a look at to maximize productivity gains. But I 156 00:08:40,859 --> 00:08:42,720 Shay Peters: think it's a case of the labor force, and we've 157 00:08:42,720 --> 00:08:46,770 Shay Peters: seen it before over various centuries with the Industrial Revolution, 158 00:08:46,770 --> 00:08:49,920 Shay Peters: et cetera, et cetera. Employees just need to change their skill set or upskill their 159 00:08:49,920 --> 00:08:53,849 Shay Peters: skill set to what's going to be in demand from 160 00:08:53,849 --> 00:08:57,179 Shay Peters: employers over the next period of time. So I think 161 00:08:57,179 --> 00:08:58,889 Shay Peters: it's all positive, it doesn't mean there's going to be 162 00:08:58,889 --> 00:09:01,290 Shay Peters: any less people in the workforce because of AI. It's 163 00:09:01,290 --> 00:09:03,120 Shay Peters: just the jobs they're doing are going to change. 164 00:09:03,900 --> 00:09:07,080 Sean Aylmer: I mean, as you say, that's probably no change over 165 00:09:07,080 --> 00:09:09,780 Sean Aylmer: decades or over centuries in fact, that's happened from the 166 00:09:09,780 --> 00:09:13,889 Sean Aylmer: Industrial Revolution probably or whatever. What should people be thinking 167 00:09:13,889 --> 00:09:16,319 Sean Aylmer: about then? If I'm in a job, how should they 168 00:09:16,320 --> 00:09:17,850 Sean Aylmer: be thinking about AI? 169 00:09:18,660 --> 00:09:20,520 Shay Peters: I think they should be thinking around like, where can 170 00:09:20,520 --> 00:09:22,470 Shay Peters: they move their skillset to that is going to be of 171 00:09:22,470 --> 00:09:25,380 Shay Peters: value to the organization? So I think if they think 172 00:09:25,380 --> 00:09:29,910 Shay Peters: about low value tasks such as processing or transactional work, 173 00:09:30,210 --> 00:09:32,759 Shay Peters: there might be a challenge there with AI coming into 174 00:09:32,759 --> 00:09:36,329 Shay Peters: play, being able to take over some of that manual 175 00:09:36,360 --> 00:09:39,360 Shay Peters: processing. If they're in a role that does that currently, 176 00:09:39,360 --> 00:09:42,690 Shay Peters: it's where do they think that they can offer value 177 00:09:42,690 --> 00:09:45,900 Shay Peters: to the organization moving forwards? Where are they seeing the 178 00:09:45,900 --> 00:09:49,770 Shay Peters: organization starting to head? They should be proactive with their HR 179 00:09:49,770 --> 00:09:52,560 Shay Peters: departments or their Org design team around where they see 180 00:09:52,949 --> 00:09:57,150 Shay Peters: opportunities in the future for employees. And then trying to 181 00:09:57,150 --> 00:10:02,099 Shay Peters: upskill through various means of either, further education or online 182 00:10:02,099 --> 00:10:05,760 Shay Peters: courses or, there's lots of opportunities to upskill out there. 183 00:10:06,150 --> 00:10:08,639 Shay Peters: And so I think overarchingly employees shouldn't be scared of 184 00:10:08,639 --> 00:10:11,759 Shay Peters: AI, it's just another form of progress. They just need 185 00:10:11,760 --> 00:10:14,370 Shay Peters: to be thinking around, what can they do moving forwards 186 00:10:14,370 --> 00:10:16,020 Shay Peters: to enhance their skillset to be of value. 187 00:10:16,320 --> 00:10:19,170 Sean Aylmer: Okay, so just parking AI, what should employees do if 188 00:10:19,170 --> 00:10:21,958 Sean Aylmer: they want to position themselves as good candidates for a 189 00:10:21,960 --> 00:10:24,780 Sean Aylmer: promotion, for a pay rise, they want to look for 190 00:10:24,780 --> 00:10:27,810 Sean Aylmer: a new job? Obviously go to Robert Walters, that's clear- 191 00:10:28,679 --> 00:10:28,920 Shay Peters: Without a doubt. 192 00:10:28,920 --> 00:10:29,000 Sean Aylmer: Yeah, without a doubt. 193 00:10:29,000 --> 00:10:29,002 Shay Peters: (inaudible) . 194 00:10:29,250 --> 00:10:32,220 Sean Aylmer: But that Dorothy Dixer has just passed. What should they 195 00:10:32,220 --> 00:10:34,170 Sean Aylmer: be doing to better position themselves? 196 00:10:34,980 --> 00:10:37,559 Shay Peters: Oh, I think they should be proactive. So they do 197 00:10:37,559 --> 00:10:39,840 Shay Peters: not sit on their heels. I think they need to 198 00:10:39,840 --> 00:10:43,858 Shay Peters: be proactive with their HR departments. HR will have a 199 00:10:43,860 --> 00:10:48,150 Shay Peters: very good understanding of the demand for labor, where it's 200 00:10:48,150 --> 00:10:49,650 Shay Peters: going to look, what it's going to look like in their 201 00:10:49,740 --> 00:10:53,250 Shay Peters: organization over the next two to three years. Find ways 202 00:10:53,250 --> 00:10:57,000 Shay Peters: where the organization may be able to support upskilling, because 203 00:10:57,000 --> 00:10:59,909 Shay Peters: a lot of organizations will. And I think that's a 204 00:10:59,910 --> 00:11:05,039 Shay Peters: real positive. I know specifically here we provide allowances for 205 00:11:05,039 --> 00:11:07,710 Shay Peters: people to look at professional development, and that's just to 206 00:11:07,710 --> 00:11:09,990 Shay Peters: ensure that we are moving our workforce in the right 207 00:11:09,990 --> 00:11:14,820 Shay Peters: direction. But overarchingly, be proactive and communicate with your line 208 00:11:14,820 --> 00:11:17,879 Shay Peters: manager and also with HR, because I think that people 209 00:11:17,880 --> 00:11:20,460 Shay Peters: that are proactive, they're going to future- proof themselves. 210 00:11:20,880 --> 00:11:22,620 Sean Aylmer: Shay, thank you for talking to Fear and Greed. 211 00:11:23,100 --> 00:11:23,848 Shay Peters: No problem. 212 00:11:24,090 --> 00:11:27,030 Sean Aylmer: That was Shay Peters, Chief Executive Officer of Robert Walters 213 00:11:27,030 --> 00:11:30,270 Sean Aylmer: Australia and New Zealand. This is the Fair and Greed business 214 00:11:30,270 --> 00:11:32,458 Sean Aylmer: interview, join us every morning for the full episode of 215 00:11:32,460 --> 00:11:35,728 Sean Aylmer: Fear and Greed, Australia's Best Business podcast. I'm Sean Aylmer. 216 00:11:36,030 --> 00:11:36,750 Sean Aylmer: Enjoy your day.