Salary Guide 2023
"I don’t think a salary guide in Ireland is as eagerly anticipated as the 2023 guide! Not only are we experiencing high salary and cost inflation, we are also witnessing a significant investment/hiring slowdown particularly in the tech sector. It seems an inflection point is upon us, but how sharp it is remains to be seen.
If you throw in rising interest rates, the continuing war in Ukraine, Covid remnants, the hybrid/remote working evolution, geopolitical instability etc.; it paints a blurry picture. In preparing budgets for 2023, many companies have to allow for a slowdown, or even a recession; but still cater for salary increases in the short term. Therefore we are likely to see a reduction in new hiring until the outlook becomes clearer.
On the positive side, despite the slowdown in tech hiring, demand remains strong in absolute terms. We have had eighteen months of high salary inflation, so the rate of increase in salaries will drop off. Companies focused on medium/long term stability and growth have likely built reserves to be calm in a turbulent period. The on-going principles of developing a people-centric culture will still prevail. Personal development, shared values, well-being, honest communication, flexibility and real respect, still matter as well as the remuneration package and will likely be the foundations of success in talent management, even as the power is shifting from candidate to employer.
As interest rates rise, funding for start-ups and ramp-ups is slowing, but still exists. In particular, valuations of smaller SAAS companies is falling but possibly reaching levels where it represents value again. So steady modest salary increases and less frenzied hiring, with a medium-term view, where possible, would help a controlled easing into a new talent landscape.
As for Ireland, we continue to outperform the world with GDP growth, but need to remain competitive to sustain and grow. Rising short-term populism may present a challenge, but very likely the long-term sustainability of strong economy will be served better with prudent spending, including salary increases. Maintaining our attractiveness for inward investment is important and cannot be taken for granted.
So a likely turbulent year ahead, and the divergence in different sectors could be larger than ever. Ireland’s agility, positivity and position in the market puts us in a strong position to deal with whatever is presented to us."
Adie McGennis, Executive Chairman