Good news for employers. Employees working in Australia’s small companies are increasingly choosing to stay with their employers.
Voluntary staff turnover rates have fallen to 9% per annum, from 12.7% in the previous year, according to the Australian Institute of Management’s (AIM) National Salary Survey 2009.
And there will be less opportunity for staff to move between small companies, with only 34% of small companies expecting to increase permanent staff numbers over the next 12 months, down significantly from 67.3% in the previous year.
The AIM National Salary based on the responses 211 contributors small businesses (under $10 million) reveal that annual salaries rose by 4.6% in the 2008/2009 year (down from 5.2% in the previous year). This downward trend is set to continue with small companies forecasting wage movements for 2009/2010 at only 4.1%.
Small companies in Victoria/Tasmania have been hardest hit, with the rate of actual salary increases down 1.1% from the previous year’s pay movements.
The chief executive of AIM NSW/ACT David Wakeley, says the combined effects of lower wage increases and higher involuntary turnover rates, amounts to significant challenges for organisations who need to contain employment costs while keeping employees engaged.
The survey found that the top reasons for staff resignations from small companies were to pursue a new challenge (in 64.7% of small companies) and to obtain better pay (in 51.8% of small companies).
A higher proportion of small companies in the survey group are using performance based plans to incentivise senior managers and salaried staff
The survey found that:
• The highest annual salary movement by job level was recorded for professional technical staff and management (at 4.9% and 4.8% respectively), while senior executives had the lowest average salary rise (4.4%).
• The highest salary increase was recorded for Finance & Accounting and HR & Industrial Relations (both 5.1%) and the lowest for Manufacturing and Purchasing & Distribution (3.6% and 3.9% respectively).
• Queensland recorded the highest salary rise for 2008/2009 at 5.4%, while Victoria/Tasmania recorded the lowest (4.4%).
Smart Company is the leading online publication in Australia for free news, information and resources catering to Australia’s entrepreneurs, small and medium business owners and business managers.
