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Survey shows salaries falling, contractors hit12/08/2003 16:00:00
The ACS has raised questions about the future makeup of the Australian ICT sector in the wake of new research drawing attention to the increasing challenges facing independent contractors. The 2003 ACS Remuneration Survey canvassed the experiences of both contractors and salaried employees, attracting a total of 1612 responses from ACS members around Australia. Carried out by the Association of Professional Engineers, Scientists and Managers, Australia, it revealed that while salaries declined in real terms over the year to April 2003 with growth of only 3.1 per cent (below CPI growth of 3.4 per cent), contract workers fared far worse in the tight market conditions. "The average increase of 3.1 per cent is the lowest recorded in the 11-year history of the ACS salary survey and well below the increase in Average Weekly Earnings of 4.7 per cent for the period, but it comes as no surprise given the current situation in the ICT sector," said ACS President Richard Hogg. "Contractors faced even harsher conditions this year, with 24 per cent of this group forced to decrease their rates in order to keep working during the survey period." Hogg said 46 per cent of contractors kept their rates at the same level as the previous year and only 30 per cent reported a rate increase, resulting in a median rate increase of zero for members in this category. "This represents a decline of 3.4 per cent in income in real terms and, if this trend continues, it could change the composition of the ICT sector as professionals begin to favour full-time salaried positions rather than more flexible, but less stable, contract roles," he said. Contracting rates reported by ACS members varied considerably, ranging from $50 to $100 per hour, depending on the work being undertaken. Two-thirds of those identifying themselves as contractors were working as Consultants at an average rate of $75 per hour, Project Managers at $90 per hour or Programmer/Analysts, attracting an average $65 per hour. "Contractors and consultants account for around a quarter of ACS membership and represent an important and highly skilled group of professionals. Any trend by professionals away from the uncertainties of contracting roles could impact the ability of companies to obtain ICT skills for short-term projects," said Mr Hogg. Public sector workers fare best The 2003 ACS Remuneration Survey found that public sector workers recorded the highest average salary increase at 3.4 per cent, keeping track with CPI. Professionals in the education sector experienced rises of just 2.3 per cent while private sector salaries grew by an average 3.1 per cent. "The results show that ICT professionals can no longer demand a premium for their knowledge and skills compared to other professions, that salaries are remaining static, and that the tough times are affecting both employed staff and independent contractors," he said. Reduced demand for ICT professionals Mr Hogg said the survey findings reflected the continued flat demand for ICT professionals, highlighting their weakened bargaining position in the tighter job market and affecting both existing and prospective employees. "Thirty-one per cent of those who responded to the survey said they had been retrenched from an ICT position during their working life, with 10 per cent retrenched more than once, which confirms what members have been saying to us anecdotally," he said. "A total of 5.4 per cent reported being retrenched during the survey period with the rate amongst independent contractors even higher at 7.6 per cent." Of those working as independent contractors, 38 per cent said they had been retrenched from an ICT position during their working lives. Management and marketing pay more General management and sales and marketing positions proved to be the most lucrative based on the median value of total remuneration package comprising base salary, bonuses, superannuation and fringe benefits such as motor vehicles, etc. JOB FUNCTION MEDIAN TOTAL PACKAGE General Management: $147,225
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