By Andy McCue, 26 June 2007 13:17
NEWS
Resignations are on the increase in the UK tech sector as bonus payments fall and pay rises drop below the national average.
The 2007 National Management Salary Survey by the Chartered Management Institute (CMI) and Remuneration Economics shows an average salary increase of 5.3 per cent across all industry sectors - down from 5.7 per cent in 2006.
Those working in the IT sector fared particularly badly, coming second bottom of the pay-rise league table with an average earnings increase of just 3.1 per cent. Only the transport and logistics sector came in lower with an average of 2.6 per cent. The survey covers 42,205 employees from trainee level to senior management.
Bonuses are also down in the IT industry. Across the sector 34.7 per cent of executives were awarded bonuses, down from 59.5 per cent in 2006. The average bonus payment in the IT industry was £5,189.
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Managers in the IT sector are among the highest earners, however. They are the fifth highest compared to other industry sectors with an average annual salary of £47,108. The national average for managers is £47,449.
Recruitment and retention of staff remains a big issue for employers in the IT industry. The survey shows resignations in the sector have increased from 4.4 per cent last year to 5.9 per cent.
Recruitment problems were reported by 81 per cent of employers and a third said they now offer "golden hellos" or signing bonuses to attract the right calibre of staff. A shortage of qualified candidates was cited as the main reason for recruitment difficulties.
Jo Causon, director of marketing and corporate affairs at the CMI, said in the report: "The steep climb in organisations reporting recruitment difficulties, mixed with an increasing number of resignations should be ringing alarm bells for employers. The marketplace is clearly tipping in favour of the employee, so if they are serious about retaining the best talent organisations urgently need to meet the needs and expectations of their staff."
Comments
There are 3 comments. Join the discussion
1. Karen Challinor
"A shortage of qualified candidates was cited as the main reason for recruitment difficulties."
nothing to do with a total disregard of anyone over 40 as they are too opinionated and difficult to manage plus they need paying more
or the total disregard of the university leaver who lacks basic management skills but is still malleable
or the total disregard of people who put so much as a single none required skill on their CV when applying as they'd get bored and leave
lets face it the number of real genuine exact matches for a position is quite small, try looking at people with more skill than is required, try relaxing the age requirement that you are no longer allowed to acknowledge exists as it's illegal but is still there
on the other hand doing this would kill off the argument for offshoring and the shareholders might have to wait for productivity to fill the coffers rather than downsizing, and we can't have that can we
2. anonymous
The reference over 40s strikes hard home, as a senior individual who voluntarily downsized for one year, I now find that most employers push away my CV with the comments "far too experienced", a euphemism for over 40 I am afraid. The industry does not want to be nearer to budget and target and have the stability that experience would bring. Using homegrown and trained talent and utilising the experienced pool would bring enormous success in delivering products and high quality.
It's a pity this is not realised.
3. Karen Challinor
"Resignations are on the increase in the UK tech sector as bonus payments fall and pay rises drop below the national average."
this practice is referred to as "Shaking the tree" and falls just short of "constructive dismissal"
people who resign do not need to be paid redundancy money and lose their severance package and probably their pension too, so it's a cheaper way to get rid of unwanted staff
lowering pay and bonuses in conjunction with spreading the work from those who do leave among those who stay is a very good way for managers to reduce head count cheaply
the shareholders and senior management reap the dividend of the reduced salary and pension requirements but strangely the company is no more profitable than it was so the workers get further reductions in salary and bonus