FM skills shortage intensifies as salaries remain stagnant
A skills shortage continues to intensify in Australia’s facility management industry despite an increase in job vacancies in the first half of 2016, according to recruitment company, Hays.
In its 2016 facilities management salary guide, Hays reports that business activity and headcounts in the industry are rising. Despite this recruitment trend, however, Hays states that it is not translating into a wide-ranging salary increases for Australia’s FM professionals.
That is unless the FM professional has the niche, technical skills that are currently in high demand throughout the industry.
Austin Blackburne, Hays Facilities Management regional director, says demand for ‘highly-skilled FM professionals’ continues to grow, and it is these people who are also securing high salaries or wage increases.
“We are seeing demand mostly in the technical FM space. FM managers with a trade background, or managers that are familiar with specialised building management software or in HVAC (heating, ventilation and air-conditioning) – they are really in demand,” Blackburne tells Facility Management.
“These guys are asking for and getting large salaries, and are probably lifting up the overall median salary in the industry. It is likely pressure will come from existing employees in these areas who are aware of this – they know they are in demand and they will want to see salary increases accordingly.”
Blackburne adds that the growing professionalism of the FM sector is also affecting the attractiveness of candidates and the salaries they can expect, with flexible and adaptable staff in demand for both soft and hard services.
“Candidates who are more corporate client facing are attractive to employers at the moment. Ultimately, it is people that are able to assimilate well into an existing culture of a client, and have the right personality,” he says. “As the profession becomes more service oriented that is what employers are wanting to see.”
Small salary increases
The Hays salary guide includes salary and recruiting trends for over 1000 roles in 14 locations in Australia and New Zealand. It is based on a survey of 2752 organisations, representing over 2.6 million employees.
According to the guide, 25 percent of construction, property and engineering employees can expect a salary increase of between three and six percent in their next review, while four percent can expect six to 10 percent rises.
Just one percent of employees can expect an increase above 10 percent. Instead over half of Australia’s construction, property and engineering workers (57 percent) will receive an increase of less than three percent. The final 13 percent will receive no increase.
“The FM outlook is for more spending and employment in the coming year,” says Blackburne. “However, it’s clear that employers remain reluctant to offer substantial increases unless absolutely necessary to secure a candidate with skills in short supply.”
Blackburne believes that the reluctance to increase salaries is partly to do with prevailing concerns about the broader economy in Australia, which has been hurt by the downturn in the resources industry. Specifically in the FM sector, Blackburne says there are additional factors affecting salaries and shaping recruitment trends.
“On a whole we are seeing the FM industry successfully transition quite well – better than most parts of the economy,” he explains. “However, employers have been back in the driving seat in recent years and we haven’t seen salaries change at the lower end for some time. It is unlikely we will any time soon because people can easily transfer [into these areas] from other industries, such as mining, where employment conditions currently aren’t as strong.”
“We are seeing demand mostly in the technical FM space. FM managers with a trade background, or managers that are familiar with specialised building management software or in HVAC (heating, ventilation and air-conditioning) – they are really in demand.
According to Hays, over the last year 16 percent of construction, property and engineering employers offered no salary increases. Those who did receive a salary increase found that their wallets were not that much heavier.
The guide outlines that 46 percent received an increase of less than three percent, 27 percent saw their pay increase from three to six percent, and eight percent saw an increase of six to 10 percent. The final three percent received an increase of more than 10 percent.
In the guide, Hays warns employers not to be complacent, because employees may start to take matters into their own hands.
According to Hays, the public sector, and in particular the education sector, has provided a surge in funding nationally and a push to streamline work by outsourcing to FM service providers.
Blackburne says the strong trend towards outsourcing of FM services will continue as major building owners transition their property management models.
“In-house FM teams are becoming less prevalent and the trend towards the outsourcing of services is continuing. But what large asset owners are saying to the outsourced companies is that they don’t want to lose their anchor tenant to a new building that is being constructed,” Blackburne explains.
He says that the current boom in construction, primarily in Melbourne and Sydney, has significantly increased competition for commercial building space, and changed the demands on FM providers at the same time.
“Recently we have been seeing a lot of new building stock, both residential and commercial,” he says. “If I am a major anchor tenant, like one of the big banks, I would be attracted to some of the new buildings that are going up. They are often green star buildings that offer tax rebates,” Blackburne explains.
“What a lot of established buildings are doing is spending up on new fitouts, trying to rejuvenate existing assets. We are seeing a lot of that and that is where a lot of the movement in terms of areas of demand is coming from.”
He adds that this situation requires FM service providers to cross over into areas where traditionally they may have never had a presence.
“They are asking these FM service providers to manage a complete fitout to make the building competitive in the current leasing market,” he says.
“The FM service provider is in turn hiring technical FM managers, schedulers, help desk, service coordinators and more to schedule the works for maintenance and other services.”
While in New South Wales, Victoria and the ACT FM service providers have benefited from large federal government outsourced accounts, Hays has observed contrasting fortunes in other Australian states.
In Western Australia, permanent roles have been scarce for many months due to the downturn in the resources industry. Many quality candidates have reacted to this by moving interstate to find employment.
Meanwhile, there has been an increase in demand for soft services in northern Queensland and the Northern Territory for gas, mining and defence projects.