Sign-on bonuses soar in popularity

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The number of employers offering signing bonuses to recruits has skyrocketed as organizations seek to attract workers in a super-competitive job market.

SEEK job postings mentioning signing bonuses have jumped 2,184% since 2019 – albeit from an extremely low base – with the total share of positions offering a commission or bonus amounting to nearly 30% .

SEEK economist Matt Cowgill said the results were consistent with a tight labor market that should ease as the economy responds to interest rate hikes and inflationary pressures.

Unlike a base salary increase that generates higher pay for the duration of an employment contract, he explained, signing bonuses provide a one-time boost.

“If you think it’s a hot job market right now, but maybe it won’t be in a few years, that’s probably how you would react as an employer,” said Mr. Cowgill.

On Friday, SEEK released its announced monthly earnings index showing advertised earnings rising 4% in the year to October 2022

The notable rise is largely the product of weak labor markets this time last year caused by shutdowns in larger states.

In fact, monthly growth had followed a sideways trajectory in recent months and averaged around 0.4%.

Mr Cowgill said that was reassuring to those worried about spiraling wage prices, with soaring inflation not translating into an acceleration in advertised wages.

The indicator also showed a boom in the bottom of the labor market, with the lowest paid workers enjoying a 4.8% annual increase in wages for the month of October.

Mr Cowgill said the Fair Work Commission’s ruling on minimum wages and rewards likely fueled the high reading.

He added that middle pay bands are likely to grow more slowly as they are more likely to be covered by collective agreements. These tend to be slower to react to fluctuations in the labor market as they are usually renegotiated every two or three years.

Elsewhere, NAB’s gauge for online sales returned to positive territory on a monthly basis.

But the metric continues to contract year on year after lockdowns pushed up online shopping in 2021.

The online retail sales index rose 2.2% in October after declining for most of the year.

Over one year, the index fell by 11.8%.

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