Why accountants are finding themselves at a loss

Professionals' salaries are failing to keep pace with inflation, despite growing demand for their services, says Martin Whitfield

A rise in demand for accountants has not been accompanied by an increase in salaries, according to a comprehensive survey of pay and benefits.

For the second year running, companies reported an increase in the headcount of their financial functions, particularly in the South-east, but salaries are not outstripping inflation. The average rise is 3.4 per cent.

"We are seeing the best job market since the Eighties," says Jeff Grout, managing director of Robert Half and Accountemps, which carried out the survey of more than 480 organisations. "But we cannot report a jobs boom."

Newly qualified accountants were the only ones to see the improvement in the jobs market reflected in their salaries, with pay increases up to double that of more senior colleagues.

Salaries in commerce, industry and finance for newly qualified accountants varied from pounds 18,500-pounds 23,500 in the South-west to pounds 25,000-pounds 28,000 in Greater London.

Mr Grout believes the reason for the failure for higher demand to trigger large increases is that there were still many people available and the biggest companies were continuing to make redundancies. Companies in the Midlands and on the South Coast, for example, cited "too many applications" as being one of their major recruitment problems.

Finance directors of a medium-sized firm (pounds 10m-pounds 100m turnover) could expect to be paid from pounds 32,000 to pounds 45,000 in the Midlands and North to pounds 40,000-pounds 80,000 in London.

Across-the-board inflation increases are becoming rare, apart from in the public sector and industry. Merit-based systems are the norm in other sectors, although a combination of merit and inflation-linked rise is often used.

Only 3 per cent of organisations reported a pay freeze, compared with 21 per cent a year earlier. Public practice rises averaged 4.6 per cent; finance 4.3 per cent; manufacturing 3.2 per cent; and public sector 2.8 per cent.

Temporary staff are increasingly being used to create a flexible workforce around a core team. Nearly two-thirds of firms used temporary workers (up from 57 per cent a year ago) and a large proportion employed temporary qualified staff. The average length of contract is 11 weeks.

Although temporary workers are being used flexibly, more firms were expecting to take on staff. Public practice and commerce were the most optimistic sectors. The most volatile sector was finance, where almost as many companies (18 per cent) predicted decreases as were expecting increases (25 per cent).

The survey, conducted in March and April, found a marked preference among companies for qualifications from the Chartered Institute of Management Accountants (63 per cent) over Chartered Accountants (38 per cent), although the reverse was the case among financial companies in London.

Recruitment is a province of the young. Employers showed a preference for candidates in their twenties (70 per cent), 54 per cent were willing to recruit those in their thirties, but only a handful would look at anyone over 40. Technical ability was the most valued skill, followed by experience and communication skills. The most influential personal characteristic was appearance, ahead of confidence, imagination and commitment.

Women make up nearly a quarter of qualified accountants. Most companies said they had equal opportunities policies, although fewer than half had a formal monitoring process.

The prevalence of bonus payments continues to expand, with 64 per cent of companies awarding some form of bonus, mainly performance-related. Schemes are most common in the finance sector and commerce, but are less widespread in public practice and in the public sector, where they are often seen as divisive.

The company car, the most widespread perk after a pension plan, isunder threat: 6 per cent of firm do not provide any company cars, while only 21 per cent of vehicles were available at a salary of under pounds 20,000.

Many accountants are being provided with a cash allowance instead of a car. This ranges between pounds 3,000 and pounds 6,000. Car parking, provided by three-quarters of firms, remains a common perk. The amount of study leave offered by most companies for part-qualified staff falls short of what is recommended by training agencies. A lack of pre-exam revision leave means many trainees use their holiday entitlement.

Managers in the finance sector complained of poor-quality applicants, while most recruiters had difficulty finding candidates with relevant experience.

'Accountancy Salary and Benefits Survey 1995', by Robert Half and Accountemps, is available free of charge from the company's offices.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

Ben Little, right, is a Labour supporter while Jonathan Rogers supports the Green Party
general election 2015
The 91st Hakone Ekiden Qualifier at Showa Kinen Park, Tokyo, 2014
Life and Style
Former helicopter pilot Major Tim Peake will become the first UK astronaut in space for over 20 years
food + drinkNothing but the best for British astronaut as chef Heston Blumenthal cooks up his rations
Kim Wilde began gardening in the 1990s when she moved to the countryside
peopleThe singer is leading an appeal for the charity Thrive, which uses the therapy of horticulture
Alexis Sanchez celebrates scoring a second for Arsenal against Reading
Life and Style
An easy-peel potato; Dave Hax has come up with an ingenious method in food preparation
voicesDave Hax's domestic tips are reminiscent of George Orwell's tea routine. The world might need revolution, but we like to sweat the small stuff, says DJ Taylor
Japan's population is projected to fall dramatically in the next 50 years (Wikimedia)
Life and Style
Buyers of secondhand cars are searching out shades last seen in cop show ‘The Sweeney’
motoringFlares and flounce are back on catwalks but a revival in ’70s car paintjobs was a stack-heeled step too far – until now
Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    SThree: Trainee Recruitment Consultant

    £20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

    Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

    £50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

    Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

    £13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

    Ashdown Group: Training Programme Manager - City, London

    £40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

    Day In a Page

    NHS struggling to monitor the safety and efficacy of its services outsourced to private providers

    Who's monitoring the outsourced NHS services?

    A report finds that private firms are not being properly assessed for their quality of care
    Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

    Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

    The Tory MP said he did not want to stand again unless his party's manifesto ruled out a third runway. But he's doing so. Watch this space
    How do Greek voters feel about Syriza's backtracking on its anti-austerity pledge?

    How do Greeks feel about Syriza?

    Five voters from different backgrounds tell us what they expect from Syriza's charismatic leader Alexis Tsipras
    From Iraq to Libya and Syria: The wars that come back to haunt us

    The wars that come back to haunt us

    David Cameron should not escape blame for his role in conflicts that are still raging, argues Patrick Cockburn
    Sam Baker and Lauren Laverne: Too busy to surf? Head to The Pool

    Too busy to surf? Head to The Pool

    A new website is trying to declutter the internet to help busy women. Holly Williams meets the founders
    Heston Blumenthal to cook up a spice odyssey for British astronaut manning the International Space Station

    UK's Major Tum to blast off on a spice odyssey

    Nothing but the best for British astronaut as chef Heston Blumenthal cooks up his rations
    John Harrison's 'longitude' clock sets new record - 300 years on

    ‘Longitude’ clock sets new record - 300 years on

    Greenwich horologists celebrate as it keeps to within a second of real time over a 100-day test
    Fears in the US of being outgunned in the vital propaganda wars by Russia, China - and even Isis - have prompted a rethink on overseas broadcasters

    Let the propaganda wars begin - again

    'Accurate, objective, comprehensive': that was Voice of America's creed, but now its masters want it to promote US policy, reports Rupert Cornwell
    Why Japan's incredible long-distance runners will never win the London Marathon

    Japan's incredible long-distance runners

    Every year, Japanese long-distance runners post some of the world's fastest times – yet, come next weekend, not a single elite competitor from the country will be at the London Marathon
    Why does Tom Drury remain the greatest writer you've never heard of?

    Tom Drury: The quiet American

    His debut was considered one of the finest novels of the past 50 years, and he is every bit the equal of his contemporaries, Jonathan Franzen, Dave Eggers and David Foster Wallace
    You should judge a person by how they peel a potato

    You should judge a person by how they peel a potato

    Dave Hax's domestic tips are reminiscent of George Orwell's tea routine. The world might need revolution, but we like to sweat the small stuff, says DJ Taylor
    Beige is back: The drab car colours of the 1970s are proving popular again

    Beige to the future

    Flares and flounce are back on catwalks but a revival in ’70s car paintjobs was a stack-heeled step too far – until now
    Bill Granger recipes: Our chef's dishes highlight the delicate essence of fresh cheeses

    Bill Granger cooks with fresh cheeses

    More delicate on the palate, milder, fresh cheeses can also be kinder to the waistline
    Aston Villa vs Liverpool: 'This FA Cup run has been wonderful,' says veteran Shay Given

    Shay Given: 'This FA Cup run has been wonderful'

    The Villa keeper has been overlooked for a long time and has unhappy memories of the national stadium – but he is savouring his chance to play at Wembley
    Timeless drama of Championship race in league of its own - Michael Calvin

    Michael Calvin's Last Word

    Timeless drama of Championship race in league of its own