KEY POINTS:
Looking to earn big money? Then perhaps it's time to clamber off that career ladder. A new salary survey has found that in the country's biggest city at least, frontline staff now get the biggest pay rises, and the baubles of the boss' office are losing their lustre.
An Auckland Chamber of Commerce survey of more than 120 occupations and 2500 participants shows salary packages for those at the lower end of the market are on the rise.
Those at the top end are either decreasing or being offset by performance-based rewards.
And with pay rates and fuel prices surging to record highs - incomes (wages and investment) rose an average 9.4 per cent in the last quarter and petrol has risen three times in almost as many weeks - the values of those rewards are also dropping.
Commissions, bonuses and the cost of the cars our chief executives and managers are driving have either remained static or fallen in value over the past two years, Chamber boss Michael Barnett said.
"There's been an increase in the number of people receiving them but there's been a drop overall in their value."
On the other hand, lower-paid workers were picking up some big salary increases, particularly in the low-skilled, labouring-type areas, which was where the most vacancies were. "The shortage means employers are filling vacancies with not-so-skilled people and they are paying the price," he said.
The demand at the top level - in Auckland anyway - was not as great, so pay rates were being adjusted accordingly.
One example was in the engineering sector, where average minimum base salaries for a fitter and turner have risen by more than $9000 since 2005, to $33,280, but decreased by more than $2000 for those on the maximum, now $54,080.
The scenario was similar in the production sector, where the average base salary for a heavy truck driver went up by more than $11,000 and an operations manager received an average increase of more than $1000.
In hospitality, maximum base salaries for food and beverage managers dropped by $10,000 but rose by around $6000 for those at the bottom of the scale.
In the administration sector, area managers had average base salary increases of $20,000-plus. Branch managers' total average packages rose by more than $15,000.
In the finance sector, more people received vehicles - 27 per cent compared with 23 per cent two years ago - but the value of the average vehicle across the industry dropped by more than $6000.
In retail, bonuses and commissions look set to take over from standard pay rises. A whopping 41 per cent more retail managers were rewarded with them in the past 12 months than in the previous year.
The trades - particularly construction - didn't do as well as in previous years.
Barnett said the strongest growth areas were in technology-driven industries and the finance, communications and biotech sectors.
Top software engineers now earned more than $150,000 a year, up almost $60,000 on last year. Their counterparts in finance saw maximum pay rates rise by just over $11,000 to $215,500.
"Auckland has half of the country's IT industry, half the creative sector, about half the finance sector and about a third of the biotech industries.
"People working in those sectors are the ones who are being rewarded and, looking ahead, they are the sectors that will continue to be strong, with communications and health."
Indicative of the economic climate, unemployment is also at a 20-year low. New figures released last week show New Zealand's jobless rate - 3.5 per cent, or 79,000 people - is now among the world's lowest.
"And that's the problem," says Wellington Chamber of commerce chief executive Charles Finny. "Getting people ... getting anyone."
He said Wellington, like the rest of the country, was feeling the pressure at all levels but unlike Auckland there had been considerable movement at the top end of the market, largely as a result of big public sector pay packages.
Average hourly earnings for public servants were now $30, almost $7 above the private sector average.
It was putting many employers in an invidious position when hiring top-end staff, Finny said. As well as having to pay more to attract recruits they were having to pay big money to retain them.
In a tight market even mediocre performers were likely to be offered incentives and rewards, "just to keep them".
Also, because the market was so candidate-driven, salaries were more attractive than bonuses. "People will just walk if it becomes too difficult for them to earn their money."
Bill Shields, president of the Human Resources Institute, was surprised by the results of the Auckland survey.
The critical shortages in Wellington, in particular, were in specialist areas and occupations that had a global demand, such as marketing, administration, accounting, HR - where, despite increasing numbers of graduates, there was a dearth of senior practitioners - Information Systems and IT, he said.
New Zealand's younger, less-experienced labour market meant more businesses were having to upskill new staff with professional training, said Shields.
On the other hand, prospective employees were increasingly fussy about what they would accept in an employer.
Said the institute's chief executive Beverley Main: "While remuneration is important, lots of other variables affect the final choice by employees as to which job they'll take."
One concern they all had was that the soaring wage bill was not being met by similar strong growth in productivity.
"What we're seeing is wage inflation as opposed to productivity-linked increases. Our productivity is still concerningly low compared to our competitor economies," said Finny.
Kitchen jobs go begging
Things are heating up in the country's restaurants. And it has nothing to do with those at the top. Instead, the backroom boys are calling the shots. As one HR type put it, the hospitality industry is "screaming out" for skilled staff.
That may be putting it mildly. Over the past five years, 67 per cent (or 15,000 jobs) of the industry's employment growth has been met by people not born in New Zealand. Industry bosses are tipping that over the next four years another 13,580 new positions will need filling.
Figures from the Chamber of Commerce salary survey show cooks and bar staff have made the biggest gains - although chefs' salaries were down considerably. A cook's average base salary is now almost $44,000, and good bar staff can earn upwards of $36,000.
Says Hospitality Association chief executive Bruce Robertson: "There's been upward pressure across most of the sector and that's driven by shortages."
Wellington's John McGrath, owner of Crazy Horse The Steak House, agrees. Service levels, generally, have risen in the past few years, and that is reflected in the higher rates of pay.
Top wait staff can now earn up to $20 an hour - in some cases double that with tips - and a good chef could expect around $40 an hour.
Most of his staff, and all his fulltimers, are on salaries. "It is incredibly difficult to find good staff. If you are good, you're definitely going to get a decent wage.
"And you work long hours in this industry. If you put your staff on a decent salary then that keeps everyone happy."
Head chef Vinnie Beaumont, 25, who has spent almost 10 years in the industry, says there has been a noticeable increase in wages over the past 10 months. "There's such a shortage of chefs you can pretty much dictate what you get paid."
Young staff straight out of training often felt they deserved the same pay as those who have been in the business for years, he says.
"But you have to remember it's a performance-based industry. You get out of it what you put in, and the pay-off is in the work you do. You also can't compare it to other jobs. There are a lot of perks which make your cost of living a lot cheaper."
Cutting overheads
Many small business owners have stopped paying waged workers because of rising costs, Auckland builder Tom Bell says. He rattles off a list that includes sick leave, annual, and statutory holiday entitlements, plus ACC and IRD costs. As a result, some are cutting back the overheads by employing staff on contract.
Bell employs three apprentices, plus a casual labourer, earning from the late $20,000s to $40,000. He also supplies their tools.
When he started the business four years ago he thought he would be raking it in. He manages, but only just, he says.
"It's taken a while, but I'm doing about $25,000 to $30,000 a month now."
In the construction industry, pay rates have remained fairly static over the past few years - a qualified carpenter earns around $70,000. Bell, who works well above the 40 on-site hours of his staff, reckons it will continue.
"There's the extra week's holiday, and ACC levies have gone up. Then there's sick pay and the stats, which mean I have to find something like six-and-a-half weeks' pay for each of them [his workers]. For a small business that's difficult."
