Extract from IDS Executive Compensation Review 325

Management pay keeping pace with inflation

January is a key date in the annual pay round and our first round-up of managerial and professional salary rises in 2008 takes place against a background of economic uncertainty and persistently high inflation. Our latest results are based on 134 salary reviews falling in November 2007 and January 2008 and covering nearly 26,000 managers and professionals.

Salary awards for managers and professionals in the private sector moved up over the three months to January 2008 following signs of a slowdown last Autumn, serving as a further indication that employers are facing upward pressures on management salary budgets. Seen from a longer-term perspective, the latest increases represent a return to the six-year high found exactly 12 months ago. Although not the only consideration, pay award trends seem to have been influenced by movements in the headline Retail Prices Index (RPI). The article provides detailed tables on the latest range of increases by management group and industry sector. Finally, we look at the role bonuses play in management reward.