The Market Information team is pleased to announce the publication of the New Zealand Pandemic Business Response Pulse Survey 2 Results which outline how businesses are coping with the Covid-19 situation and what actions they are taking within their business to cope with staff levels of pay.
Strategic Pay Chief Executive Officer, John McGill, says that organisations understanding of their current situation is such that plans are being made for the next few months with further wage cuts and redundancies being clearly signalled as they are now better able to access the impact of their own organisations. The length of the lockdown and nature of any economic pickup remain difficult to plan for. We do not see survey respondents opting for the more optimistic opinions. The Public Sector remains more insulated from the immediate effects with, not surprisingly, few taking up the offer of wage subsidies (many of the survey respondents are of course outside the size eligibility range).
Findings from the second New Zealand Pandemic Business Response Pulse Survey offer valuable information on what is currently occurring in the New Zealand marketplace beyond what we are hearing anecdotally.
Some key findings include:
- The Private Sector and the NFP Sector are the largest users of the government wage subsidy scheme. 37% of Private Sector organisations are using the subsidy to maintain pay at 100%, 26% are using it to maintain pay at a level less than 100%, usually 80%.
- 81% of organisations do not have plans to pay incentives for employees required to work on-site during the pandemic lockdown. This is a consistent policy across all sectors.
- Some private sector orgs are only accessing the wage subsidy scheme for select key and essential staff to maintain 100% of pay for that group, with other staff seeing reduced pay levels of varying degrees. A number of Private Sector clients note that if the lockdown continues beyond 4 weeks staff pay will need to be reduced and redundancies will start to happen.
- In the Private Sector, 31% of responding organisation are reducing executive pay, with the most common percentage currently being a 20% reduction although it ranges up to a 50% reduction.
- 17% of private sector organisations are considering plans to reduce board fees based on longer term impacts. Across all sectors, there are currently no plans to change board fee levels.