Remuneration Trends and Insights

Quarterly Remuneration Trends

Mercer’s Quarterly Remuneration Trends looks at Australia remuneration and the jobs market for the previous quarter.



Quarterly Remuneration Trends – Q4 2020



Movements remained stable at 2.0% in the fourth quarter of 2020

Executives  saw increases of 2.3%

Employees in Victoria and South Australia  received  increases at the national median

The mining industry passed on the highest movements overall

Companies with parent locations in the United Kingdom recorded the highest increases


Reported throughout this article is the Employment Cost (EC) remuneration aggregate. Commonly referred to as ‘total package’ or ‘fixed remuneration’, Employment Cost includes base salary, cash allowances, benefits and fringe benefits tax (FBT), but excludes variable reward.


Mercer’s remuneration database operates on a rolling basis, with organisations providing remuneration data submissions throughout the year. As a result, each quarter we share the overall remuneration trends in addition to industry-specific results for those sectors for which reportable data is available.


All-data movements

According to Mercer’s database, the median employment cost movement for same incumbents (the same people in the same role at the same organisations) in the general market remained stable at 2.0% over the fourth quarter of 2020. It is worth nothing that whilst the data reported here covers the period of 1 April to 30 December, when the effects of the pandemic were influencing the economy, many organisations had already passed on their remuneration increases. Reported here are annual movements in salary and as such may not fully reflect actions taken by organisations in response to the economic downturn.


Due to the ongoing pandemic, Mercer Australia has paused remuneration forecasts from 1 April 2020. Our databases published prior to this date are still effective as of the dates published, though we advise against projecting (i.e. 'aging') market remuneration data past 1 April 2020 given current levels of economic uncertainty.


With regards to remuneration actions for organisations approaching the typical 'remuneration review' period, experience from prior economic downturns globally suggests muted salary increases or freezes and reduced incentive payments will be observed as organisations preserve cash to weather economic headwinds. During this period Mercer advocates for a prudent approach to ensure employment is maximised and businesses remain solvent.

Source: Mercer's remuneration database



Distribution of increases


Source: Mercer's remuneration database



Whilst the overall median same-incumbent fixed pay movement has remained stable on the previous quarter at 2%, there has been a broader range of increases passed on by organisations in our database. As the figure shows, 19.8% of same-incumbent increases recorded in Mercer’s database to the end of December have been between 2% and 2.99%, with a further 28.7% receiving increases of 3% or higher. While 26.1% of incumbents received zero increase.


When looked at by industry, the majority of incumbents in our database from most sectors received median increases of between 1% and 3%. The mining sector had the highest proportion of incumbents receiving increases greater than 5%. On the other side of the spectrum the manufacturing sector received the highest proportion of zero increase (salarry freeze).



Career stream movements


The staff categoy that recorded the highest median EC movements this quarter was executives reporting 2.3%. All other career levels recorded median EC movements of 2%.

Source: Mercer's remuneration database



Location movements


Employees in Victoria and South Australia recorded the highest median EC increases at 2%. While employees in all other locations received movements below the general market movement. The Northern Territory recorded a median EC movement of 0%.

Source: Mercer's remuneration database



Job family movements


Roles in the drilling, exploration and operations job family were awarded the highest increases with a median movement of 3.4%. At the opposite end of the scale, the construction job family recorded the lowest median movement at 1.1%. 

Source: Mercer's remuneration database



Industry movements


The mining industry recorded the highest median movement over the fourth quarter of 2020 at 3%. Conversely, the industry sector passing on the lowest increases this quarter was manufacturing where the median movement was zero.

Source: Mercer's remuneration database



Movements by parent location


Organisations with their parent company located in the United Kingdom recorded the highest median movements at 2.5%, followed by those with a parent company located in Australia, Asia and the United States of America at 2%. While European headquartered organisations reported the lowest median movement across the fourth quarter of 2020 at 1.6%.

Source: Mercer's remuneration database

Disclaimer: While every care has been taken to ensure the accuracy of the information, no warranty is given in respect thereof.


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