Back-office staff get biggest City pay rises

Workers in the City of London, the heart of the UK's financial services industry, saw their pay rise last year by an average of almost 4 per cent, a report showed yesterday.

Workers in the City of London, the heart of the UK's financial services industry, saw their pay rise last year by an average of almost 4 per cent, a report showed yesterday.

The growth was driven by a 14 per cent jump for support and administrative workers, the recruitment consultancy Morgan McKinley said.

Prospects for the jobs market in the City remained positive, it said, despite concerns of poor retail sales, rising interest rates and a slowing housing market. It said a projected upturn in mergers and acquisitions activity would lead to a recruitment drive by corporate finance firms, while the growing burden of regulations would fuel demand for accountants.

Ken Brotherston, the chairman of Morgan McKinley, which specialises in banking and financial services, said: "2005 is shaping up to be a solid year for financial services in London and therefore for recruitment. Where areas of high demand are met with a paucity of candidates, there will naturally be an upward movement in salary levels."

Last year the consultancy recorded an average rise in salary in the City of 3.7 per cent to £45,046. Middle market professionals and administrative or support staff had the highest rises over the past 12 months.

The average salary for senior professionals and directors rose only slightly - by 0.7 per cent to £66,031 - but Morgan McKinley said bonuses were a significant part of the overall remuneration package. "Growth in projected business volumes led to a strong increase in demand for staff across all levels, particularly in the early half of 2004. This placed upward pressure on salaries," Mr Brotherston said. However, the Centre of Economics and Business Research said in a report that growth among architects, accountants and the advertising industry would outpace those in the banking sector.