WA loses in the pay race

IT probably comes as no surprise that Western Australians earn less than their eastern states counterparts.

This pay difference is often attributed to the lower cost of living Western Australians enjoy, but several remuneration and recruitment specialists say that is not the only reason.

They say a combination of the level of responsibility, job availability, and the volume of skilled candidates also affects the remuneration rates.

Michael Page International director Greg Sinclair said Western Australians earn, on average, 10 to 15 per cent less than their Victorian counterparts and 15 to 20 per cent less than those working in Sydney.

“The most obvious factor is the cost of living but you have to look at the difference in the markets,” Mr Sinclair said.

“Perth’s industry is not as big as Sydney and Melbourne so there is an oversupply of quality candidates that also adds to the salary differentiation.

“In the professional areas, human resources, sales and marketing type roles, they are definitely paid more on the east coast because there is a greater supply of jobs there. Generally these jobs are at the corporate offices which tend to be headquartered in Melbourne or Sydney.”

Remuneration specialist Ernst and Young GemS’ Sue Jauncey said a remuneration package depended on the responsibility of the position, the size of the organisation along with a population component.

“When we conduct remuneration reviews, living cost is a very small percentage. To determine a salary we look at the annual revenue and size of the organisation and what the responsibilities and accountabilities of the position are,” Ms Jauncey said.

“A sales and marketing position could attract a bigger salary on the east coast because of regional factors.”

Mr Sinclair said the responsibility and scope of a job position in Perth was different to a similar one in head offices located in Melbourne or Sydney.

“In the business professional disciplines such as accounting and technology, the functions are at a branch office level and have a State focus. They have a different role than those in the head office,” he said.

“But if you compare Perth and Brisbane, Perth is much less a branch office because of its isolation and distance.

“The role in Perth may require more autonomy whereas in Brisbane people in Sydney could facilitate it. In Perth many companies have more responsible people on the ground and from a corporate professional’s point of view Perth would have more opportunities.”

The WA employment market does struggle to keep its middle managers with many securing lucrative jobs overseas or seeking out higher remuneration on the east coast.

TMP Worldwide WA general manager Barry Knight said that while the demand for middle managers had recently dried up, he believed the tide would turn again as the economy picked up.

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