Buying Power Boosts UK's Pay Ranking

By Fiona Moore, for 23 December, 2014

A new report has found that middle-management salaries in the UK lag behind Switzerland, Luxembourg and Germany by more than GBP10,000 (USD15,600), but that comparatively low gross pay for professionals in Britain is compensated for by greater "buying power" due to low taxes and cheaper living costs.

The findings appear in the latest Towers Watson Global 50 Remuneration Planning Report. The report reveals that Britain ranks 13th out of the top 15 European economies when it comes to gross entry-level professional pay, with a median of GBP27,199 per annum, but that this rises to sixth place when buying power is factored in. The median gross pay for middle-managers is GBP72,524, and buying power increases the ranking from seventh place to fourth.

The buying power adjustment puts the UK ahead of France, the Netherlands, Spain and Italy in both cases.

The report also shows that gross entry-level salaries in the UK have overtaken Spain and Italy since 2013, while middle-management pay has risen above Ireland, Austria and the Netherlands.

Carole Hathaway, Global Leader of Towers Watson's Rewards practice, said that the UK's ranking had risen due to UK employers responding to pay pressures within the constraints of a challenging economy. Darryl Davis, who is senior consultant in the company's Data Services team, added that although there is still a "considerable gap" between the UK and the Continent's highest wage markets, UK wages "are able to grow in a healthy way while remaining competitive in cost terms versus other Western European economies."

Tags: Western Europe | Tax | Business | Ireland | Netherlands | Luxembourg | United Kingdom | Professionals | Austria | France | Germany | Spain | Switzerland | European Union (EU) | Expats | Working Abroad | Europe | Work | Working Abroad | Working Abroad |


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