Financial & Professional Services Workers Play Salary Snakes & Ladders Since Boom
PR Log - Nov 21, 2012 - Lawyers’ salary growth has outpaced accountants’ pay inflation since the last boom according to analysis of ONS data carried out by Randstad Financial & Professional, the accountancy, financial services and legal recruiter.
● Lawyers’ salaries rise 8.1% compared to 7.5% increase for their accountancy peers ● Change in behaviour as candidates prioritise job security over remuneration
Whilst the average annual salary of a UK employee has risen by 11.4 per cent since the last full year before the credit crunch (2006), both lawyers and accountants have seen lower salary increases. Legal professionals have seen comparatively stronger growth, with lawyers and solicitors seeing an average pay increase of 8.1% since 2006. In contrast, accountants at a similar post qualification level have seen their pay rise by 7.5%.
However, there has been a growing pay divide within the legal sector. While lawyers have seen more robust pay rises over the period, the average pay of associate legal professionals such as paralegals and executive assistants is down 8.6% compared to 2006.
There has been a similar pay gap among those working within accountancy. While chartered accountants’ salary growth at a newly qualified level has remained steady over the last six years at 1.3%, finance managers and other senior accountancy professionals have enjoyed a 7.5% rise. Taxation experts have been best off with a pay increase of 9%, whilst finance and accounting technicians have seen pay fall by 18.2% in the period – the largest fall of all jobs tracked by the ONS.
In the financial services sector, insurance underwriters have seen pay rise by 0.4% whilst finance and investment analysts have seen pay rise by 3.7%. However, the picture is by no means uniform as those at manager level within financial institutions have seen pay rise by 20.2%.
Tara Ricks, managing director of Randstad Financial and Professional, said: “It’s tempting to think that salary rises in financial and professional services have been hit across the board since the last boom as companies look to keep costs down. But actually it’s been more like the board game snakes and ladders. Even within specific areas like law and accountancy, different roles have seen salary inflation at a completely different pace.
“At an entry level, pay has remained relatively static as firms reduced their graduate intakes. The greater number of would-be legal and accountancy trainees competing for positions has meant a relatively flat playing field both for those entering and exiting training contracts. But at the other end of the spectrum, the most qualified and experienced professionals are still in demand. While pay hasn’t rocketed up, those professionals with the skills required to meet new regulatory rules in place since the credit crunch are enjoying stronger salary growth.”
Jobseekers have also changed their behaviour in response to the current economic climate. According to Randstad Financial & Professional’s latest Recruitment Review, jobseekers are now more concerned with job security than higher salaries. 22% of jobseekers see working for a financially stable company as the most important factor when finding a new job and 18% prioritise long-term job security, as opposed to the 16% who see a competitive remuneration package as vital.
Tara Ricks adds: “Interestingly, despite negative discussions in recent years around remuneration in certain sectors, most notably financial services, salary is no longer the key driver when moving firms. Our review suggests that there has been an acceptance of compensation levels as a result of the prolonged and fluctuating fortunes of the financial and professional services sector.
Passive top talent will still consider a move to a competitor - despite tough market conditions and lower salary inducements. But demonstrate too much caution in your enticement of these people and you risk the perception that all may not be well within your business. Our advice to organisations that are operating a lean cost base but still need to hire is to ensure more emphasis is placed on your company’s solid foundations and future prospects throughout the interview process.”
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Notes to editors
The Randstad group is one of the leading recruitment & HR services providers in the world with a top five position in the UK and a top three position in fifteen countries including the US, France and Germany.
In the UK, Randstad’s business lines serve the public and private sectors across Accounting and Financial services; Business Support; Construction, Property and Engineering; Education; Health and Social Care; Interim Management and Search; Human Resources; IT; Legal; Retail; Sales, Marketing and Creative; Student and Worker Support and In-House and Managed Services.
At the end of 2011, Randstad had 1,930 corporate employees in the UK, working in 255 locations. UK revenue in 2011 was €789 million. Randstad was founded in 1960 and is headquartered in Diemen, the Netherlands. Randstad Holding nv is listed on the NYSE Euronext Amsterdam. For more information see www.randstad.co.uk and www.randstad.com.
 Based on analysis of the ONS’ Annual Survey of Hours and Employment from 2006 to 2011 (the latest edition available).