It’s a well documented fact that male employees tend to earn better than their female counterparts. Why this anomaly still happens in 21st century workplaces is a  mystery.

Some interesting results on male and female pay disparity is emerging from the recent study we did on high-income executives in Australia. Interestingly, male executives tend to get their pay rise as a result of their performance, while female executives are more likely to get a raise if they change employers or move around departments.

When asked ‘what triggers your pay rise’ (see chart) more men tend to get their raise from activities (such as performance review and promotion) which, generally speaking, involves a modicum of self-promotion and confrontation. Arguably, changing employers, through which 24% of female executives got a raise compared to 19% for male, is less confrontational than asking for a pay rise.

Are women executives less demanding when it comes to asking for a pay rise? Why are more men getting a pay rise as a result of performance review? Does the disparity in how male and female executives get their pay rise contributes to disparity in the amount earned? If so, why?

I will be dissecting more of the subject in Melbourne. Come along.

I played with ABS data. The graph below tells us two things:

a) We have come a long way with our pay. Since Nov 1983, average national weekly earnings almost tripled, increasing from $312.60 to $923.40 in May 2009.

b) We have a long way to go before gender pay equality exists. In May 2009, men earn $1115.80 compared to women who average $733.40.

The graph is a simplistic trending picture of gross national earnings (before tax), and may not be reflective of many professions or industries. However, pay disparity along gender lines is a puzzling reality. In some industries like IT, the inequality is driving women away.

A lot of attention has been shed on executives pay. Gender disparity in earnings deserves equal, if not more, attention.

If you are female and earning less for doing the same work as your male counterpart, would you do anything to rectify it? If you are male and aware of pay disparity how would you react? What is your story?

Do you offer monetary incentives to motivate staff?  Think again.

Dan Pink believes traditional reward practice like increasing pay aren’t always effective in motivating and improving staff performance. He argues that there is a huge mismatch between the science behind motivating people and what companies practice. To illustrate his point Dan quoted two riveting studies:

“In eight of the nine tasks we examined across the three experiments, higher incentives led to worse performance” ( Federal Reserve of Boston, Paper No. 05-11)

“We find that financial incentives….. can result in a negative impact on overall performance” (Dr Bernd Irlenbusch, London School of Economics)

Incidentally, Dan used Atlassian to illustrate the value of intrinsic rewards. Dan’s talk will challenge how you view incentives and staff motivation.

Salaries in the Australian tech sector grew by 4%. The government sector saw a 4.6% hike, while IT professionals in the private sector saw their salaries increasing by 3.9%. Given the general state of the national economy, the global financial crisis and reduced IT budgets, the surprise is that salaries in the tech sector grew at all.

But is it really any surprise at all?

12,872 IT job vacancies are listed on SEEK. IT continues to hold sway as the largest and most vibrant employment sector in the Australian economy. The sector is proving to be very resilient over the years, overcoming major upheavals such as offshoring, past recessions and the dot com crash. Technology is ubiquitous in our daily lives; it is not about to go away anytime soon. Strong demand for IT talent will continue to be a permanent trend in the years ahead.  Remuneration hike even in the midst of a downturn vouch for that truth.

“At the end of my salary I always have a lot of month left” – loesje.org

The economy is shuttering, salaries are doomed! Wrong, it’s never completely black or white. In fact, very few things in an organisation are more critical, contentious and complex, than the salaries of staff. Varying widely across industries, regions and companies, how salaries behave is hard to understand and unpredictable.

Yet, remuneration is deeply intertwined with recruitment; it is a subject which will continue to define our industry.

In the coming days, I’ll explore more about the subject in various contexts. Meanwhile, here’s a presentation from a year ago where I discussed about remuneration trends in the technology sector. Some of the data (e.g. unemployment rate) needs updating, but the main themes (e.g. the importance of intrinsic benefits) around the drivers of remuneration trends remain valid.  What is your experience of using remuneration as a recruitment tool?

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