In a week when City bankers got awarded some of the biggest bonuses for years (with the cost of living crisis being replaced in the Square Mile at least with a price of Champagne contest), there was also new evidence of a less extreme, but nevertheless noticeable shift in the wider employment market.
A new survey from Manchester-based recruitment firm Adam led with a combined headline finding that while 75% of people are in some way looking for a new role (with 47% doing so actively), 59% are not satisfied with their salary and package. And pay and benefits has, for the first time, made it to the top of the list of reasons for leaving a job. This marks a major change. Money has rarely, if ever, topped the list of reasons people change jobs.
Leon Mills, co-founder of Adam - and a Supper Club member - explains that the market at the moment is unlike any he has witnessed before "It’s never ever been this competitive for talent," he says. "Just like the property market at the moment, people are snapped up within a week, having received multiple offers above expected value. Candidates have all the power and it’s a superb opportunity for great people who want to look at exciting roles. We’ve honestly never seen anything quite like it."
The traditional perspective has been that less tangible benefits (culture, career progression, feeling valued and doing meaningful work) are the major reasons. These are also therefore the most effective ways to keep people and have been traditionally seen as more effective in this regard than a pay rise. Money is often at best only a short-term incentive to stay somewhere (we all quickly get used to what we are earning and end-up dissatisfied again within six months). But if people are now leaving jobs for purely financial reasons, it's logical that extra money may also keep them in a role.
A third of respondents to the Adam survey claimed they could get more money doing the same job somewhere else. Although now that "somewhere else" is not literal. The pandemic-induced explosion of hybrid and remote working means people may well change jobs and stay at the same home office desk. And the boom in such working means that more employers (in more sectors) are facing new competition for workers from overseas, with a whole new set of employers eager to tap into the UK talent pool.
This genuinely global war for talent is one factor in the rising gap between candidates' current salary and desired salary. Of course, rampant global inflation is another. And it's telling that Adam found that even at board level, half of respondents are not happy with their current salary.
Another factor driving the push for higher wages is the knowledge that there is something of a talent shortage and that there are plenty of roles on the market. For the same reason, existing employers are aware that finding replacement talent is going to be difficult, expensive and time consuming. As a result there has been a surge in counter-offering, with Adam reporting an average of 10% to 15% salary increase being typical.
But such "buybacks" are increasingly coming with other perks and benefits thrown in to sweeten the deal, ranging from the promise of further pay bumps down the line and better career progression opportunities.
While there are some variations by sector and across different positions, the main themes from the Adam salary survey are consistent. It means your pay bill is likely to continue going up, whether you manage to keep hold of your best talent or have to let them go and find replacements.
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