Salary expectations rising among new hires, says recruitment company

Driven by rising inflation and undersupply of candidates due to the “volume of new positions” opening up across the economy, salary expectations for new hires rose sharply between April and June.

Recruitment company Morgan McKinley’s latest employment monitor indicates that the number of professional job vacancies increased by more than 9 per cent in the second quarter of the year. The number of professionals actively seeking new job opportunities jumped by almost 11.5 per cent over the same period.

At 4.8 per cent in June, the Irish unemployment rate was close to pre-pandemic levels, the company said. The report notes that an average of 22,900 jobs vacancies appeared in the three months between April and June, while the average number of professionals looking to switch roles rose from more than 72,000 to 90,412 over the same period.

Consequently, new hires have been able to ask for more in their contract negotiations. The challenges are more acute in certain jobs markets, Morgan McKinley said. A shortage of candidates for high-tech roles such as full-stack developers, data scientists and security analysts “has increased day rates among contract technology professionals”, the report suggests. Because smaller tech companies struggle to compete with larger ones on benefits to attract permanent staff; small businesses are “increasingly seeking talent from the contract market”.

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Salaries are also on the rise in supply chain management and procurement roles while the labour market in the funds sector — which has grown in recent years as a consequence of Brexit — continues to be “busy”. The market for executives is also “buoyant”, the report noted, “and shows no sign of slowing down”.

“We are definitely seeing a candidate-driven market at the moment,” said Trayc Keevans, global foreign direct investment director at the Irish-owned company.

“The supply and demand effect of professionals is driving an increase in salaries for new starters with many seeking to off-set the impact of rising inflation by negotiating higher starting salaries,” she said.

“In a candidate-driven market, employers have to offer more competitive salary and benefits to attract new hires or at least consider deploying more creative compensation and benefits packages that will appeal to the talent cohort they are seeking to attract.”

Ms Keevans said there has also been “Covid rush” of inward migration in recent months with big tech companies looking to “regularise a return to office-based employment” and asking employees to relocate to Ireland.

“This is leading to pressure on both long- and short-term accommodation through to September,” she said. “We are advising companies who may be seeking to bring in talent from abroad to factor this into their hiring timelines.”