NEW ZEALAND 2014/15. salary & employment FORECAST. & construction

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1 NEW ZEALAND 2014/15 salary & employment FORECAST property & construction ANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTION SFINANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUC SALESFINANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONST TIONSALESFINANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&C RUCTIONSALESFINANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERT ONSTRUCTIONSALESFINANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPRO Y&CONSTRUCTIONSALESFINANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAI PERTY&CONSTRUCTIONSALESFINANCEMARKETINGPROPERTY&CONSTRUCTIONSALESFINANC RKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTIONSALESFI EMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTIONSALE ANCEMARKETINGCONSTRUCTIONOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY& STRUCTIONSALESFINANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPE CONSTRUCTIONPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTIONSALESFINANCEMA INGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTIONSALESFINANC RKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINSALESFINANCEMARKETINGOFFICESU RTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTIONSALESFINANCEMARKETINGOFFI PPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTIONSALESFINANCEMARKETING CESUPPORTPROPERTY&CONSTRUCTIONPROCUREMENT&SUPPLYCHAINSALESFINANCEMARKE OFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTIONSALESFINANCEMA INGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTIONSALESFINANC RKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTIONSALESFI EMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTIONSALE ANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUCTION SFINANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONSTRUC SALESFINANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&CONST TIONSALESFINANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERTY&C RUCTIONSALESFINANCEMARKETINGOFFICESUPPORTPROCUREMENT&SUPPLYCHAINPROPERT ONSTRUCTIONSALESFINANCEMARKETINGOFFICESUPPORTCONSTRUCTIONPROCUREMENT&SU CHAINPROPERTY&CONSTRUCTIONSALESFINANCEMARKETINGOFFICESUPPORTPROCUREMEN PPLYCHAINPROPERTY&CONSTRUCTIONSALESFINANCEMARKETINGOFFICESUPPORTPROCUR NT&SUPPLYCHAINPROPERTY&CONSTRUCTIONSALESFINANCEMARKETINGOFFICESUPPORTPR

2 RECRUITMENT ACTIVITY Strength of current hiring activity compared to the last 12 months Expecting to increase headcount Stronger (21%) Slightly stronger (30%) Steady (3) Slightly weaker (11%) Weaker (1%) 61% YES 28% NO UNSURE 11% Market observations: Hiring activity within property and construction is strong and is expected to continue due to increasing business confidence in the sector. The property and construction industry is currently leading New Zealand s economic boom with new developments as the Christchurch Rebuild continues to gain momentum. Funding and approval for new build construction continues to increase across the country with key areas being Auckland and Christchurch. There has been an increase in high-rise apartments and the redevelopment of schools. Christchurch is a key area for funding and approval for new build construction as a full scale redevelopment is underway. There is an increase in retirement villages across the Auckland region, with new developments and expansion from both local and offshore investors being approved, which is creating new opportunities for property and construction professionals. Large scale team restructures within a number of major property businesses are currently creating churn in the job market. There is a continuing skill shortage in the areas of facilities and property management. The market is slowly maturing and understanding the need for these roles, however there is currently a lack of specialist professionals to meet this demand. Hiring activity is strongest for Client Side, Consultancy, Facilities Management, New Build and Interior Fit Out professionals. There is a significant lack of talented professionals with technical expertise and capability at a senior level and the ability to manage scale, volume and complexity. Currently businesses are strengthening their assets as new laws are enforced following New Zealand s earthquake disasters. This is giving local businesses and tenants the opportunity to upgrade properties which have been neglected over the last few years, leading to more interior fit-outs. Current salary levels are low in comparison to more established markets where property and facilities management is a more mature industry. It has therefore been challenging for employers to obtain quality professionals with the right qualifications. Professionals in highest demand include Project and Site Managers, Facilities Managers and Quantity Surveyors. An increase in successful tenders has resulted in increased demand for experienced Project Managers to handle the workload and, as these projects start, experienced Site Managers with a solid background to drive projects forward are also required. As more tenders become available, strong intermediate Quantity Surveyors will be required to reduce pressure on Senior Surveyors. The demand for these professionals is expected to increase over the next 12 months. Professionals with skills in property development and project and facilities management, particularly technical specialists, are in high demand. There is currently a shortage of intermediate professionals with solid experience in these areas, as there is a lack of training for graduates. New Zealand s construction sector is currently experiencing an increase in projects being tendered, with the types of projects becoming more complex. New building construction standards are leading to increased demand for professionals with a good mix of project experience and experience with high value and large scale builds ($30 million plus). There is an increase in property and construction talent coming from the UK, China and South Africa looking for work in New Zealand as the market improves and more job opportunities are available. Most migration can be attributed to professionals looking for a change in lifestyle and nationals returning from Australia due to its declining job market. Employers are displaying caution when it comes to hiring overseas professionals so the demand for hiring New Zealand workers is high. 2

3 RECRUITMENT ACTIVITY Experience level expected to be in highest demand Expectation of a professional skills shortage in the next 12 months Entry level 13% Unsure No Mid level Management Senior management 59% 20% 4 % 26 % Specialists 1% Yes 70 % Skills shortage placing upwards pressure on salaries Impact of skills shortage on businesses in New Zealand over the next 12 months 4 Yes, it will cause salaries to rise above the inflation rate (61%) 34% Yes, salaries will increase but only at the rate of inflation (25%) 5% No, the skills shortage will not impact salary levels (14%) Need to develop more targeted attraction strategies It will be difficult to maintain headcount Source talent from overseas Other* None *retention will be important, restrict business growth, etc. 3

4 RECRUITMENT ACTIVITY Plans to hire overseas workers within the next 12 months Expectation of local talent leaving for overseas opportunities 26%? 52% 25% YES 75% NO 22% SALARY AND REMUNERATION Salary increases over the next 12 months Average percentage salary increase over the next 12 months 13% All my employees will receive the same percentage increase 0% - 2% 2% - 3% 16% 56% 55% All my employees will receive an increase, but it will vary according to performance 4% - 5% 23% 6% - 1% 10% - 15% 4% 24% Only my best-performing employees will receive an increase 8% No one in my team will receive an increase Market observations: Organisations are currently focusing on increased growth and expansion and, as a result, are paying above average salary increases for professionals with business development skills who can generate new business. Quantity Surveyors at the intermediate level are in short supply and are able to command higher salary increases. In a competitive employment market, some professionals with specialist skills, such as site managers, are being awarded above average salary increases to start projects immediately. 4

5 SALARY AND REMUNERATION Factor most likely to impact salary levels in the next 12 months Flexible salary packaging or fringe benefits offered to employees % Individual, team or company performance % 17 % 4 % 4 % 4 % 3 % 1 % Domestic economic conditions Competition with other companies Inflation Don t expect any factors to impact salaries Other* Global economic conditions Not sure 4 YES 53% NO *retention of staff, government policy, etc. Companies providing bonuses as part of the remuneration package Basis for bonuses over the next 12 months Team performance Company performance 53% 4 4 % 8 % 20 % Average percentage bonus of gross salary Individual performance 1% - 5% 25% Combination of the above 6% - 10% 11% - 15% 16% - 20% 55% 13% 5% 68 % 21% - 30% 2% 5

6 SALARY AND REMUNERATION Employer expectations for staff turnover in the next 12 months Key reasons employees are likely to leave 62% YES 21% NO UNSURE 1 $ 32% 23% 15% 15% 13% 2% Improve salary Broaden experience/ opportunity to learn Gain more seniority Other* Achieve better work/life balance Overseas opportunities *organisational restructure, performance management, etc. Most popular tools for attraction and retention Strong company culture Structured career progression Recognition and rewards Training and mentoring partnerships Work/life balance initiatives 41% 22% 1 8% Market observations: Many companies are using LinkedIn, networking and employing dedicated in-house recruitment teams as a way to source quality talent. However, there is also an increase in companies using recruitment agencies as a result of having difficulty in identifying and attracting talent through their own channels. Many professionals are becoming more selective when choosing job opportunities, and are looking for more promotion opportunities as well as financial rewards when accepting a new role. Other 4% Global career opportunities 1% 6

7 Most popular options offered to support employees work/life balance* Combination of benefits offered to employees* 25% 4 72% Flexible working arrangements Team building/offsite activities Alternative leave options (e.g. volunteering) 97 % Mobile phone 72 % 64 % 64 % Parking Company car Personal laptop 14% Increased maternity/paternity leave 56 % Healthcare/health insurance 11% Other** 28 % Higher superannuation contribution Sabbaticals 17 % 8 % Travel pass Income protection insurance **fitness classes, none, etc. 6 % Other*** ***shares, flexi hours, etc. * More than one option could be selected. 7

8 WORKING HOURS Average weekly working hours Less than 37.5 hours hours hours hours 50 hours or more 1 % 29 % 46 % 21 % 3 % Change in average weekly working hours over the last 12 months 1% 34% 64% Increased Stayed the same Reduced 1% Significantly reduced Main reason for increased working hours 63% Business growth 15% Fewer headcount 15% Other* Working from home on a work laptop or mobile *smaller margin, increased outcomes, new business growth, greater market activity,etc. 8

9 SALARY TABLES PROPERTY/REAL ESTATE Size of company Sml/Med Large Salary $ 000 $ 000 Leasing Executive Leasing Manager Leasing Director Valuations Manager Head of Valuations Property Manager Head of Property Management Asset Manager Head of Asset Management Facilities Executive Facilities Manager Head of Facilities Development Manager Development Director General Manager Managing Director Regional Managing Director CONSTRUCTION Size of company Sml/Med Large Salary $ 000 $ 000 Quantity Surveyor Site Manager Estimating Manager Bid Manager/Business Development Manager Operations Manager/ Manager Project Engineer Project Manager Project Director Manager Director Operations Manager Operations Director Please note: 1. Salaries indicated are in New Zealand dollars and based on annual basic salary, excluding bonus/incentive schemes. 2. Small to medium companies are defined as having a turnover of less than $100 million. Large companies are defined as having a turnover of more than $100 million. 3. Market rates are becoming much less uniform. While we have taken great care, these salary ranges can only be approximate guides, as there are often specific circumstances relating to individual companies. Please call us for additional information. 9

10 CONTACT US Auckland Level Queen Street CBD Auckland 1010 New Zealand Tel Fax Worldwide leaders in specialist recruitment

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