Australian employers to boost 2024 salaries by 4.0%; insurance sector trails: WTW

Inflationary pressures and concerns over a tight labour market continue to be catalysts.

Employers in Australia are forecasted to increase salaries by 4.0% this 2024, albeit the same rate was implemented in 2023. The insurance sector, however, is projected to have a smaller increase from last year.

According to a WTW survey, the sector’s actual salary increase for 2023 was 4.4%, second highest to BioPharma and Life Sciences of 4.5%. For 2024, the insurers could expect an income hike of 4.2%.

The hike goes against the backdrop of the high inflation rate of 5.7% the country is facing.

Looking back, salary increases of 3% have become a common practice along with inflation rates below 2%.

“Executives are observed to take the hit as this employee group’s salary increase is 3.6% on average, compared to the middle management and professionals at 4% and support staff at 4.1%,” the WTW release said.

ALSO READ: WTW's new parametric policy protects vulnerable South Pacific reefs

Inflationary pressures and concerns over a tight labour market continue to influence factors behind the salary increase budgets.

Some companies have started to get creative in their pay design, introducing benefits such as transportation allowances and salary packaging to help employees cope with soaring costs, especially as in-person work mandates increase.

Employers are facing significant challenges in attracting and retaining key talent, with a voluntary attrition rate of 14.3% expected to normalise at around 10 to 11% levels in the next couple of years.

The survey conducted in December 2023 involved over 700 companies across various industries, providing insights into salary trends and talent dynamics in the Australian market.