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Wage spiral predicted to continue in 2024
Unresolved skills shortages, growth-ambitious business leaders and a cost-of-living
crisis have all exacerbated the high quit rates of 2023. The result – the highest annual
growth in regular pay the UK has experienced in the past two decades.
According to new research by recruitment firm Ledger Manager and Billings Clerk would
Robert Half, almost a third (32%) of employers command 26.4%, 26% and 36.2% higher
are finding themselves in the middle of a wage salaries respectively. A similar picture is
spiral, having to inflate salaries to maintain a seen in financial services, where a Financial
competitive edge in the war for talent. With Controller can expect 16.2% more; within tech,
69% of businesses confident in their 2024 software development professionals are able
growth prospects, the need to recruit skilled to secure pay increases up to 24%; and within
employees to ensure business continuity the legal professions, the average annual
and growth still outweighs concerns about wage increase is 12.4%.
economic uncertainty.
Matt Weston, Senior Managing Director UK
The firm’s 2024 Salary Guide – which & Ireland, at Robert Half, commented: “Many
analyses and reports on market salaries, employers may be shocked next year at the
hiring trends, and skills requirements across salaries that some of their most in demand
the UK – also revealed that a further 26% roles will command. Without careful planning
of companies are offering additional one-off this will weigh heavily on company profitability
bonuses to keep hold of their staff. at a time when businesses are struggling with
costs.
With inflation still an issue for the UK, almost
half (41%) of employers indicated that they “Yet, pay is not the ‘be-all and end-all’.
will offer a flat-rate salary increase for all A robust corporate culture and a tailored
employees in the next 12 months, while retention programme can be a cost friendly
27% are planning pay increases in line with strategy. Our research shows, for example,
inflation. that almost half (47%) of the workforce would
reject a new job if the company didn’t offer
Annual average pay rises for private sector flexible working, yet news reports continue
employees was 8%, yet a closer look at some to highlight brands that are enforcing office
of the most in-demand skilled roles reveals a returns. And in many instances employees
more concerning wage spiral snapshot for the leaving a business do so due to deep-
inflation embattled economy. Although across rooted talent attrition causes such as heavy
the board salary increases are in line with the workloads and a lack of development
ONS results, the 2024 Salary Guide forecast opportunities. Business leaders must address
shows the average annual pay growth in all aspects of the employee experience and
accounting operations is up by 9.6% year- must do so fast, since an increase in pay is
on-year, where, depending on experience, the inevitable by-product of ‘jumping ship’.
roles such as Financial Accountant, Purchase
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