The latest release of the Hays Salary Guide FY25/26 has found rising dissatisfaction with pay, progression and perks among Australians. The country’s largest and most comprehensive review of salaries and workforce trends, finds a paradox at the heart of today’s labour market: although salaries are rising (ABS, 2025), many employees still feel underpaid, overworked and undervalued as cost of living continues to bite.
Based on a survey of over 12,000 respondents in ANZ across more than 25 industries and 1000 roles, the Salary Guide reveals an ongoing tension between employee expectations and employer offerings, making retention and recruitment more challenging than ever.
The report finds nearly two-thirds (61 per cent) of people are planning to change their career path, with most doing this due to a lack of future opportunities in their current role/workplace (45 per cent) and low salary (42 per cent).
While salary is a key motivator to change jobs, the report also shows that there is a great disparity in what is viewed as satisfactory. Minimal salary rises (2.5 per cent or less) were found to deliver the same satisfaction as no raise at all. Increases up to 14 per cent offer only marginal improvements, while moderate bumps (up to 14-20 per cent) can backfire. The report found that only transformational increases (20 per cent+) have a significant impact on employee satisfaction.
“The data tells a story of paradox and caution,” said Matthew Dickason, CEO, Hays APAC. “Employees are satisfied enough to stay put for now, yet a significant portion are looking to move elsewhere, wary that small pay increases aren’t worth accepting. This should tell employers that despite the cost of living, salary is no longer enough – benefits, progression, and purpose matter more than ever.”
While salary remains critical, employees are increasingly prioritising flexibility, additional leave and health benefits over traditional perks. The majority (58 per cent) rank flexible working as their most valued benefit, followed by extra annual leave days (45 per cent), clear signals that work-life balance trumps outdated offerings like company phones or internet subsidies.
Yet despite this, a disconnect persists: only 21 per cent receive additional leave and employers continue to offer undervalued benefits at scale. Only two of the 25 surveyed benefits were preferred by more than 20 per cent of employees and together, they ranked higher than the remaining 21 benefits combined.
“This points to a clear disconnect that is costing talent and retention,” says Dickason. “And when salary increases don’t meet expectations, employers should be considering how to soften the blow or incentivise employees with wanted benefits that are beneficial to both sides.”
Despite a challenging hiring climate, there are signs of optimism. While 84 per cent of organisations experienced skills shortages in the past year, over half rating them as moderate to extreme, there are early signs that the pressure is easing. Just under half of all employers now report only minor or no shortages at all.
The current bottleneck is not in job creation or candidate supply, but in alignment: businesses cite a lack of human skills, such as people skills like communication, people management, EQ and interpersonal skills (82 per cent); adaptability to change and uncertainty (73 per cent) and creativity – critical thinking, problem-solving, judgement and decision making (59 per cent) – as the primary limitations to growth. These deficits are most prevalent at the intermediate career stage, the very group driving job mobility.
“In response to these needs, 94 per cent of employers say they are prioritising investment in people this year, with a focus on training, automation and structural change,” adds Dickason. “This investment push marks a turning point: one that prepares organisations not only to unlock stalled productivity, but also to embrace the next wave of transformation – the rise of AI.”
Dickason advises that if anyone is considering a job or career change, they should define what matters most to them: salary, relevant benefits, purpose, or progression. “Be clear on what you’ll walk away with, and what trade-offs you’re willing to make,” he says.
Download your copy of the Hays Salary Guide for professionals and for employers.
