Skills in demand but salary increases are sedate

By Jason Walker, Managing Director, Hays New Zealand

CIVIL CONSTRUCTION SKILLS may be in high demand, but don’t expect generous salary increases as a result.

Skilled professionals will receive salary increases of sub-three percent this salary review season.

There’s no doubt that civil construction remains an active jobs market, with an improving economy, net migration growth and government infrastructure spending combining to drive up confidence.

In findings released in our 2017 Hays Salary Guide, business activity increased over the past 12 months for 75 percent of surveyed employers, while four in five (81 percent) expect business activity to increase in the year ahead.

Underpinning this are increased commercial construction and transport projects in Auckland, an active residential sector and anchor projects gaining momentum in Christchurch, earthquake repairs and new highways in Wellington, and infrastructure recovery work in Kaikoura and North Canterbury.

The overall greater investment in services as a result of a growing population and net migration is also adding to activity.

It should come as no surprise then that hiring intentions are positive; 48 percent of surveyed employers expect to increase permanent staff levels, far exceeding the nine percent who say they’ll decrease. Meanwhile 20 percent expect to increase their use of temporary and contract staff, also exceeding the eight percent who anticipate decreasing in this area.

Employers are even creating positions for quality candidates who become available since the forward workload looks promising and they do not want to miss out on strong talent. This trend is particularly noticeable for engineers with New Zealand experience.

However, skill shortages are already having an impact on employers’ ability to fill staffing needs. Some 80 percent of surveyed employers, compared to 74 percent last year, said they are worried that skill shortages will impact the effective operation of their organisation in a significant (37 percent) or minor (43 percent) way.

In particular demand are quantity surveyors, estimators, land surveyors and geotechnical engineers at the senior CPEng level. So too are candidates with large-scale project and seismic strengthening experience.

Civil engineers at all levels with strong technical 3D skills are also in demand. Many consultancies are either top heavy and require staff at this level to complete the modelling and design work, or do not have enough chartered engineers to manage projects, teams and sign off work. Civil engineers are also sought for infrastructure work on water services and road projects.

We’re also seeing a supply shortage of civil tradespeople, especially ticketed machine operators (digger/roller/grader) for new subdivision projects and major motorway and road upgrades.

Plant and machine operators with a class 2 licence or above are sought too, as are certified and CCC approved drain layers and senior concrete cutters. Finally, the UFB rollout to new subdivisions has increased demand for senior cable joiners.

A cautious approach to salaries seems at odd with these trends, and continues employers’ inclination over recent years of smaller salary increases.

In fact, most of New Zealand’s civil construction professionals are in for a sedate pay rise of sub-three percent: 66 percent of employers will give their staff a pay rise of up to three percent in their next review while five percent will not increase salaries at all.

The exception is in engineering, for structural engineers in particular. For example, our 2017 Hays Salary Guide shows that typical salaries for structural engineers are $65,000-$120,000 in Auckland and $60,000-$140,000 in Wellington and Christchurch.

Is it any wonder then that staff turnover is starting to become a key focus point as workers actively seek better opportunities? Already 28 percent of employers say staff turnover increased in their organisation over the past year.

Of course, main contractors and subcontractors have had to reduce margins to win projects. However civil construction professionals are aware of the improved economy, job opportunities and skill shortages out there and are therefore more willing to ask for a pay rise.

Our Salary Guide found that over half (54 percent) intend to ask for a pay rise in their next review. A further 22 percent are as yet unsure.

As the old adage says, fortune favours the brave.

In such an environment, staff engagement should be a priority and one simple strategy is to recognise staff for a job well done.

Forms of recognition vary depending on what works best for each individual organisation and its employees, but the one thing all successful recognition programmes have in common is that they are sincere.

It costs nothing to let staff know that their hard work and successes are valued and the two words ‘thank you’ can have a huge impact.

• For further information on current recruitment trends, or to discuss your next move or new hire, visit www.hays.net.nz or call your local Hays office.