More than half of Irish professionals plan on looking for a new job in the first six months of this year, according to a major report by global recruitment company Morgan McKinley.
Key hiring decision-makers from 636 businesses and more than 3,800 professionals from across Ireland, the UK, Australia, Canada, Hong Kong, Japan, Mainland China and Singapore were surveyed for the group’s salary guide this year.
While 53 per cent of Irish professionals are planning to look for a new job in the first half of the year, 54 per cent of employers think they will lose staff over the same period due to higher earning potential elsewhere.
Morgan McKinley said the Irish data shows employers will be more cautious around salary increases this year with pay rises likely to be as much as 5 per cent across a range of sectors.
There will be exceptions for the most niche and in-demand positions where salary increases of 10-15 per cent could be in prospect.
The report also finds two-thirds of employers think salaries in their specific sector will rise this year. Some 57 per cent of employees think they will receive a salary increase this year.
Trayc Keevans, global FDI director at Morgan McKinley Ireland, said businesses now “seem to be rebalancing”.
“Wages have rocketed in recent years by margins that appear unsustainable,” she said. “In order to maintain profitability in a highly inflationary environment, businesses need to keep their costs down and a key way of doing this is by limiting salary increases.
“Last year provided a second consecutive year of significant growth in salaries. This came from a combination of cost-of-living pressures and competition for talent driving up offers, as companies sought to secure the much-desired top talent by outbidding their competitors.”
She said companies had to take active steps to hold on to existing employees, with 71 per cent of them increasing salaries. All of this meant that 60 per cent of professionals in Ireland received a salary increase in 2022.
The biggest increases (34 per cent) were a 0-3 per cent rise, but a further group (19 per cent) received more sizeable increases in excess of 15 per cent.
While more than half (57 per cent) of professionals in Ireland are expecting to receive salary increases in 2023, it is “unlikely” we will see the widespread wage growth we have become accustomed to over the past two years.
Ms Keevans said the significant increases in pay across many industries have become “largely unsustainable”.
She said Ireland has yet to see the impact the job losses in the technology sector will have on salaries.
“Early indications suggest this talent is confident of securing their next job, but it is too early to foresee whether this trend will be for equal or lesser levels of total compensation than they have enjoyed in big technology employers,” she said.
“The importance of flexibility and affording employees the right to work remotely cannot be underestimated.”