Industry: Pay in large firms beats inflation

Earnings for employees in large and medium-sized companies are "racing ahead" of inflation, according to research by a firm of pay consultants. Total wage cheques are increasing by 5 per cent a year, while the inflation rate is just 3.7 per cent.

In a survey of 500 employers, Watson Wyatt, human resource and benefits specialists, confirm that percentage rises are increasingly generous the further you go up the ladder. Senior managers have seen their total earnings rise by around 6.6 per cent.

The much sought-after information technology experts are receiving bonuses of up to 30 per cent a year to persuade them to stay with companies and sort out the so-called "millennium bug".