| Bonuses key to financial services pay rises |
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| Written by Adrie van der Luijt | |
| Friday, 11 January 2008 | |
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Salaries in the UK financial services sector rose by an average of 4.2 per cent in 2007 though this masks wide variations, especially when total cash payments are considered.
Average total cash (which includes salaries and bonuses) in the UK financial services sector rose by between 1.2 per cent and 11.3 per cent last year, depending on job function, according to consultants Watson Wyatt. Watson Wyatt's 2007 UK Financial Services Compensation Report shows that average basic salaries across the financial services sector rose by 4.2 per cent, while total cash rose by 5.4 per cent. Those working in investment management saw the highest total cash rises with an average 11.3 per cent. Other jobs which benefited from strong total cash growth included sales (7.9 per cent), commercial/corporate banking (7.7 per cent), actuarial (7.4 per cent) and life underwriting (6.4 per cent). Jobs which typically saw lower than average median total cash increases included purchasing (1.2 per cent), technical (3.8 per cent) and credit/lending (3.9 per cent). The Watson Wyatt report found salaries rising at a similar level of just over 4 per cent regardless of seniority. Total cash increases were higher for directors and senior managers (7.2 per cent), however, compared with junior professionals (5.0 per cent). Iain Nichols, a senior consultant at Watson Wyatt, said that the trend continued whereby base pay increases were fairly consistent across organisations. "The differentiation is made through bonus payments and comes as a result of the desire to differentiate individual performance as well as the financial performance of the organisation, with salaries rising above average where there is demand for specific skills and abilities," Nichols added. Watson Wyatt found that 18 per cent of companies look to position base pay above the average, with the vast majority (72 per cent) aiming at the average level and 5 per cent below. Five per cent have no policy. On a total cash basis, however, the proportion looking to pay above market rates rises to 43 per cent. Related articles
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