CEOs to workers: Don’t expect pay rises

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The Executive Connection’s latest survey of CEOs shows that more than 37% expect their employees to receive no pay rise in 2019, or at best an increase of no more than 2%. A third of respondents expect pay rises of 2-3%, and 14% expect wages to increase by at least 4%. Meanwhile, two-thirds of CEOs have indicated that they are either adopting or considering flexible working conditions to attract and retain top staff, while 30% are seeking to reduce labour costs by investing in automation. From The AFR:

“This low wage growth story has become a macroeconomic phenomena around the world and the RBA is starting to put it at the centre of their monetary policy,” said economist Warren Hogan, who advises The Executive Connection that conducts the survey of 251 chief executives.

“With the surprising level of businesses increasing the amount of investment in automation I think that tells you wage growth into the future will also be less,” Professor Hogan said…

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.