news Operational riskMarkets & trade Splash247
Recent reports have indicated that seafarer salaries are on the rise due to a labour shortage in the industry but the actual numbers behind the rise paint a far more complex picture. Survey results from close to 5,000 seafarers published earlier this month by Danica Crewing Specialists suggested wage increases have occurred this year on all vessel types Henrik Jensen, Danica’s CEO, said that the combination of a general shortage of competent seafarers, along with a better financial situation for most vessel owners, is making employers more generous with their remuneration and causing wages to continue to increase. However, the level of increases has come into question, with many experts suggesting they are failing to keep up with inflation. Maritime recruitment specialist Spinnaker said in its annual Seafarer Wage Cost Survey, which looked at data for 250,000 seafarers, that all of the respondents in its survey conduct yearly pay reviews. However, reviews don’t always translate to pay rises. The company stated that whilst 74% of companies awarded a raise of over 1.1% to junior officers, this wage growth has not kept pace with inflation. For senior officers, 73% of companies awarded a rise of over 1.1% and they were more likely to receive a rise of over 3% than juniors or ratings. Even the small pay rise is still a rise, but pay freezes persist in around 16% of companies for senior officers while 21% of companies froze pay of junior officers. Spinnaker predicts even more widespread pay freezes for 2025. “With the rate of inflation being about 9% and wages going up by 4% and then 2% that is well below the rate of inflation. It is irresponsible for someone to report as if seafarers’ salaries are acceptable,” Carolyn Graham, a senior lecturer at the Faculty of Marine and Nautical Studies at Caribbean Maritime University, told Splash Extra. Another issue is the fact that seafarers are being paid according to the standard of living in their countries. “In developing countries – or any country except the advanced economies of Europe and North America – the rates of inflation are high, and dollar figures might look like a lot but in terms of purchasing power it may not be so,” Graham added. Spinnaker did say in its report that nationality-based salary scales are on the decline as 45% of participants reported using nationality-based pay scales, compared to 54% in 2023. “This is something we’ll be keeping a close eye on. Even 50% of non-cruise employers say they are not differentiating pay based upon nationality. We want to understand whether this means levelling up or levelling down for particular nationalities and whether it means that some nationalities previously seen as too expensive might now benefit or if that means they will simply have to accept lower wages to obtain employment,” said compensation and benefits manager at Spinnaker, Sandra Brown. To see how this works at a company level Splash Extra asked Kuba Szymanski, the secretary-general of InterManager, to provide information on how members of his shipmanagement organisation handle these situations and the answers were in line with data from Spinnaker. Although the members were left anonymous, it is clear that there were no blanket increases for officers. Senior officers were given 2.5% pay rises while another member stated that wages had been adjusted in accordance with market requirements by up to 5%. Also, ratings on vessels covered by International Bargaining Forum (IBF) and Int
Seafarer pay failing to keep up with inflation
Splash247
Read full article at Splash247 →
Opens Splash247 in a new tab