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UK — Restructuring and job insecurity cause staff to jump ship

23 February 2010

The 2010 National Management Salary Survey, published jointly by the Chartered Management Institute (CMI) and salary survey specialists CELRE, reveals a labour turnover rate of 13.6%, up from 12.4% in 2009. Resignations stand at 4.7%, compared to 4.5% 12 months ago. In a surprising move, the survey results also imply that employers are failing to persuade staff to stay, with requests for 'internal transfers' as an alternative to leaving dropping to 3.6% from a high of 5.8%, last year.

Asked what lies behind this desire to change jobs, more than half the employers questioned (53.8%) admitted that restructuring and job insecurity caused many of their staff to 'jump ship'. A significant proportion (38.5%) recognised that their 'failure to offer career opportunities and training' contributed to employees leaving. Given widespread recognition that engaged staff are more loyal, it is alarming that 61.5% also admitted that their employees' heads had been turned by head-hunters and recruitment consultants.

The survey goes on to reveal an average salary increase of 2.5% across the UK. Those in the North East and Scotland, with an average 3.2% pay rise, have enjoyed the greatest financial reward during the recession. However, at the bottom of the 'league table for salary movements' are individuals in the South East, who have brought home an average pay rise of just 1.5%. There are also stark differences by seniority level, with junior staff in Northern Ireland enjoying a 4.4% increase, compared to managers in East Anglia securing a 2% rise.

In real terms, the findings show an average salary of 21,876 Pounds for junior staff across the UK and 43,119 Pounds for their counterparts at team leader level. Outside London (26,103 Pounds) the highest earners at junior level are based in Northern Ireland (22,570 Pounds). Their take home pay represents a 4,682 Pounds difference against the lowest paid junior employees, based in the South East (17,888 Pounds).

At the other end of the pay scale senior function heads in the South East are the highest earners (excluding London). With an average salary of 123,769 Pounds their pay packet is 39% higher than the lowest equivalent roles in East Anglia (75,988 Pounds).

Ruth Spellman, chief executive of the CMI, comments "a year ago employers were looking at job transfers as a way of halting growth of the dole queue. However, with the latest figures showing that staff are prepared to run the risk of unemployment by jumping ship, questions must be asked about employee engagement levels in organisations up and down the country."

"It is clearly time for business to grow up. We can no longer afford to reward people with pay rise after pay rise especially as all the evidence suggests that money isn't the main motivator anymore. Instead, employers must concentrate on building remuneration packages that incorporate earnings with development opportunities, offer flexible approaches to work and recognition of the need to better engage with staff."

With unemployment figures currently quoted at 2.47 million, an additional unexpected result from this year's survey is that employers are struggling to recruit staff. According to the data, 46% of employers have admitted they cannot fill vacancies, with the majority (77%) citing the lack of specialist skills amongst candidates as a key reason. Almost one quarter (24%) blame the salaries they are able to offer and 15% suggest their location is a factor.



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