Australian employers use market data to price new roles

Australian employers are leaning more heavily on external market data when setting pay for newly created or unfamiliar roles, while relying on company financials and internal benchmarks for positions they hire for regularly, according to research commissioned by recruiter Robert Half.

The survey of 500 employers across Australia found that companies use different reference points depending on how established a role is inside the organisation.

The results point to a more formalised approach for familiar roles, and a more market-led approach when employers face new job titles and changing skill mixes.

For roles that employers hire for regularly, the most commonly cited factor in salary decisions was company performance or profitability, referenced by 50% of respondents. Guidance from HR teams and internal salary benchmarks followed at 47%. Fixed salary scales ranked third at 38%.

External sources still featured in pay decisions for these roles, though at lower levels. Industry benchmarking tools ranked fourth at 36%, while 34% of employers said they relied on a recommendation from the direct manager.

Robert Half said this pattern reflected the use of internal frameworks such as salary bands, performance-linked budgets, and established job architecture. The figures also show that a significant minority of employers check external data even for roles they consider routine.

When employers set salaries for roles they have not hired for before, the survey results showed a different ordering. Industry benchmarking tools came first, cited by 39% of respondents. HR guidance and internal salary benchmarks ranked second at 37%, and online salary guides placed third at 36%.

Company performance or profitability fell to 34% for new roles. Fixed salary scales also sat at 34%. The figures indicate that employers turn first to external reference points when they lack in-house pay history for a role or when they cannot map it neatly to existing salary bands.

The study covered hiring managers in finance, accounting, IT and technology, and HR. Respondents included small and medium-sized enterprises, large private organisations, publicly listed companies, and public sector employers.

"Company profitability remains the top driver of pay for familiar roles, indicating that many businesses continue to take a budget-first approach to hiring," said Nicole Gorton, Director, Robert Half.

"While financial performance is important, relying on it alone can leave businesses out of step with the market. Salary expectations are increasingly shaped by skills scarcity, role complexity, and external demand. Companies that balance internal performance with up-to-date market data are better positioned to attract and retain in-demand professionals, especially in sectors where salary expectations move quickly.

"As job structures evolve and skill requirements change, flexibility and adaptability are becoming core elements of effective workforce planning. Increasingly, organisations are relying on market-informed salary setting for new and emerging roles, reflecting a broader shift towards data-driven decision making," said Gorton.

The survey suggests employers are trying to reconcile internal pay governance with a labour market that continues to generate hybrid roles. In practice, this often requires organisations to compare job content and required skills against external benchmarks, then decide how to align that with existing pay frameworks.

For established roles, the dominance of profitability and internal benchmarks indicates that many organisations continue to treat salary setting as part of broader budget management.

Fixed salary scales also remain a common mechanism, particularly in larger organisations and parts of the public sector where formal pay structures shape remuneration decisions.

For new roles, the greater emphasis on industry benchmarking tools and online salary guides indicates that employers see external intelligence as a starting point. This approach becomes more prominent when a role combines skills from different disciplines, or when organisations enter new areas of technology and compliance where internal reference points are limited.

Robert Half commissioned the research through an independent firm and conducted it online. The company said respondents included hiring managers responsible for recruitment decisions in their function.

The findings come as more organisations review job families and salary bands amid shifting demand for specialist skills. Employers continue to add new roles as business teams adopt new systems and workflows, and the mix of internal and external inputs into salary decisions looks set to remain a central feature of hiring in the year ahead.