It’s January, which means the annual banker bonus debate is making headlines again. But according to new research, it’s not just the bankers who will be cashing in this year: apparently, bonuses across the private sector are set to rise in 2011, thanks to improved performances across the economy. Fair enough, you might say – but will struggling businesses feel under pressure to keep up with the Joneses?
The research, by Incomes Data Services, found that, this year, the number of private sector firms expecting to pay higher bonuses was more than three times higher than the number expecting to pay lower bonuses. And salaries look like they’re on the up too, with the average wage expected to jump by 2.5%. Admittedly, that’s not exactly inflation-busting (inflation currently stands at 3.7%) – but it’s higher than the average wage rise for the last three months, which according to figures released on Wednesday morning by the Office for National Statistics, stood at 2.1%.
And while the two best-paying sectors are still (you guessed it) banking and oil and gas, last year’s salary figures for non-board directors weren’t too shabby. In fact, the average basic salary for directors without boardroom roles reached £110,000; that's an average of £132,000 in the private sector, and an ever-so-slightly more conservative £93,555 in the public sector.
Good news for staff, but not necessarily for firms. The standard defence that ‘you’ve got to pay well to get the top people’ could backfire, because while, by all accounts, most firms are set to see a stronger performance this year, it might take a while before their balance sheets truly reflect that - particularly those that are still finding things tough after the recession. The trouble is that after a few years of corporate thrift, workers could well be impatient to be rewarded now their hard work is finally starting to bear fruit...