Salary increases are determined – and influenced – by a range of factors, including company size and profitability, geographic location, employment equity policies, union relationship and, most importantly, the supply of and demand for Supply Chain professionals. It’s likely that higher-than-average salary increases will be awarded to key, ‘in demand’ staff in 2015, Tech-Pro tells SmartProcurement.
Tech-Pro defines salary increases as either formal or informal.
‘Formal’ increases refer to increases that are offered to all employees at a set time in the year, based upon performance or fixed criteria. ‘Informal’ increases are those earned either through job change or through payment of a ‘scarce skill’ premium.
Formal Increases in 2015¹
PE Corporate Services publishes a national, twice-yearly General Staff Survey, covering salaries earned by over 500 benchmark jobs, including some in Supply Chain Management.
The average annual increase in basic salary, across all staff categories, for the period to July 2014, was 7.4%, says PE Corporate Services’ National Business Development Manager, Deirdre van Greunen.
This is up from the 6.9% offered to July 2013 – and is the highest increase percentage reported since 2010.
Highlighting the fact that many employers use higher-than-average increases to retain key staff, 24% of respondents increased salaries between 8% and 11%, with 14% of respondents increasing salaries between 9.1% and 10%.
Each year, respondents are asked to predict overall average increases for the next 12 months. The overall average predicted increase in basic salary across all staff categories for 2014/2015 is 7.2%.
It will be interesting to see how much the predicted figure will move: the overall predicted increase for 2013/ 2014 was 6.7%, while the actual was 7.4%.
Informal Increases in 2015
Over the past six months, Tech-Pro has seen a marked rise in informal increases earned by high-demand supply chain staff, primarily as a result of job change.
“A number of Tech-Pro candidates have recently been offered large increases to join a new employer,” says Greeff Moolman, Team Leader at Tech-Pro.
For example, in July, one of our Supply Chain Manager candidates received an offer of employment that was 35% more than he was currently earning. And, in August, a Consultant accepted an unprecedented 136% increase in salary, noted Moolman.
While large, informal increases are still fairly uncommon, ongoing demand for highly skilled supply chain professionals is bound to have a long-term effect on earnings and increases’.
Has rising demand for supply chain staff influenced salary increases offered by your company? Which of your staff are most affected? What others factors influence earnings?
For more information on PE Corporate Services’ General Staff Survey, please contact Deirdre van Greunen on dvg@pecs.co.za.
Greeff Moolman can be contacted on gmoolman@tech-pro.co.za
