The average Australian executive salary in 2013 fell below the critical $200,000 level, according to the research firm Ipsos MediaCT. The decline – from $212,000 in 2012 to $198,000 in 2013 – was about 6.6 per cent, and maintains a recent trend.
For good measure, Australia has rarely needed to face the so-called 1% problem – the disproportionate inequality in income characteristic, notably, of the United States. That is because executive pay has been remained tied to levels seen in smaller European nations, rather than those in big bad America or Britain. What’s more, salaries have dipped since 2007, returning it to 2004-05 levels, by some measures.
Nevertheless, Australia’s executives are an important group, not only for the power they exercise over the nation’s business – each makes decisions worth $2.5 million annually, down from $2.9 million in 2012 – but also as a consumer group. Their salaries are 70 times the national average. And if you go with the average for executives at companies in the ASX 100, the compensation package begin to get a lot higher at $4.7 million, including bonuses. Even though their salaries have dipped, the Business Elite maintain an average net worth of $1.7 million and bought more luxury items than the previous year, according to Ipsos’ annual “Business Elite” survey.
“The consistently high net worth of the Business Elite provides them a great deal of spending power, with quality-of-life pleasures such as travel, cars, art, jewellery and wine still a purchase priority,” Ipsos MediaCT Managing Director Simon Wake said. “For example, 54% intend to travel in the next year, 30% intend to buy a new car, 26% intend to buy residential property and 21% intend to buy a laptop.”
Anyway, who is Australia’s Business Elite?
The average business leader in Australia is a 47-year-old, tertiary-educated male. Among the Business Elite, men over the age of 40 comprise 60 per cent. The proportion of women has increased slightly – from 16 per cent to 19 per cent. Youth, too, has a growing importance, gaining five percentage points to 14 per cent.
Still, the Business Elite remains somewhat conservative in its media consumption. Even though its social media use is big – more than the general population – the group relies mostly on newspapers with The Australian Financial Review the most “far-reaching publication with the highest engagement.”
In social networking, LinkedIn is, obviously, the most popular platform with three out of four executives using it. In smartphone usage, the surprise might lie in the fact that only 83% use them. Clearly, you could live without one.
The annual Business Elite survey, part of a global one by Ipsos MediaCT, interviewed 1,600 Australian executives via mail or online. All were either C-suite or department heads in companies with 20-99 employees (finance and business services) or 100+ employees in all other private sector industries.