Posted by Robert Half on 13 June 2014
You've got to the end of another busy month, having worked late most nights to get through your workload, and do the best possible job for your employer. Quite rightly, you feel you deserve to ve rewarded for a job well done. But do you know what you should be earning?
As a professional, you need to be earning a wage appropriate to your qualifications, expertise and endeavour, and, of course, the difficulty of your job. You need to ensure your wage reflects the role, and the value you offer to your employer.
Some 27 per cent of professionals interviewed in a recent Robert Half study said they are looking to switch jobs because of dissatisfaction with their current salary. With the recession a fading memory and the economy growing, average earnings should be on the rise. So if you feel you should be paid more for the contribution you make, now could be a good time to consider your options.
The state of the current market
In a rapidly improving jobs market, there are plenty of opportunities for skilled and experienced professionals to move jobs and progress with their careers. Organisations are looking to upskill and add capacity, ensuring they are ready and able to exploit potential growth opportunities.
Particularly in accounting, where demand for skilled professionals far exceeds supply, job availability is very good. And with organisations competing for the best people, wages are quickly rising within the sector.
The reality is that accountant salarprofessionals are in a stronger bargaining position than they have been for some years. Talented individuals can potentially earn significant pay rises if they switch jobs, as employers may be willing to pay a premium to secure their services. Given the shortage of skilled and experienced finance professionals in the UK, employers realise they have to make their pay and benefits offering more attractive in order to be competitive.
Scope for negotiation
But you might not have to move jobs to secure a pay rise either. Employers are eager to keep hold of their best people, and they recognise that salary inflation in a competitive market for talent is pushing wages upwards. If they value the service you provide, they may be willing to offer a pay rise and/or increased bonuses in order to keep you on the books.
A recent study conducted by Robert Half found that 87 per cent of finance leaders are experiencing challenges in finding suitably qualified workers in the current market. As such, they are re-evaluating their talent acquisition and retention strategies. Some 42 per cent of UK employers surveyed by Robert Half expect to boost base salaries this year, while 26 per plan to offer bigger bonuses to their staff. Among those planning to increase pay, the average rise will be 6.1 per cent - a figure several times the rate of UK inflation.
Clearly, skilled accountants have the chance to boost their earning capacity - and disposable income - in the current market. There are two options available to you: apply for a new job that commands a greater salary, or attempt to negotiate with your employer. So long as you are performing well in your job and adding value to your organisation, both approaches offer scope for an increase in basic pay.
What should accountants be earning?
If you suspect you're receiving below the going rate for someone of your expertise, there is a simple way to find out. The Robert Half Salary Guide for finance and accounting benchmarks pay within the industry, showing how much professionals typically earn. The document also predicts the rate of salary inflation for next year, based upon employer demand for certain skills and specialist roles.
What accountants should be earning typically depend on the size of the organisation you work for and also your location. With larger businesses typically having greater resources, they tend to pay more handsomely than small and medium-sized enterprises (SMEs). There is also some regional variation in average salaries, with professionals working in London earning roughly a third more than the national average.
In 2013, the average company accountant working for an SME - excluding London - earned between £32,500 and £48,750. Robert Half has predicted a 0.9 per cent rise to £33,000-£49,000 this year. A higher rate of pay inflation is anticipated for group accountants working for larger companies - a 1.4 per cent rise from £40,500- £64,250 to £41,250-£65,000.
High levels of demand for qualified management/financial accountants means their salaries are rising fast in 2014. SME professionals can expect to earn between £34,000 and £54,500 this year, up 3.8 per cent on 2013, while those working for large companies should see a 4.1 per cent rise to £42,500-£64,750. For systems accountants, Robert Half has forecast a 2.2 per cent rise in SMEs to £37,500-£57,250, and a 3.0 per cent increase to £47,500-£62,750 in larger organisations.
Salary inflation of 1.6 per cent (to £40,750-£68,250) is expected for SME project accountants and 1.3 per cent for those working in bigger business (to £48,250 - £71,500). Cost accountants can also expect to earn more, with average salaries set to rise by 0.9 per cent in SMEs (to £38,000-£42,750) and 1.1 per cent in large companies (to £40,750-£47,500). For assistant accountants, average wages are expected to be between £18,750 and £26,000 in small companies (up 1.1 per cent) and £22,250-£31,250 (up 1.4 per cent) in larger firms.
But is pay the only motivator?
Of course, you need to consider pay and benefits in the wider context of your role, and the rewards it offers. In some instances, you may be working for a lower than average salary, but enjoy a host of other benefits such as flexible working, childcare support, an attractive pension and company car.
Equally, you may also be seeing more rapid career progression with your current employer than you could expect elsewhere. Because the company cannot afford to pay the going rate for finance staff, there may be opportunities to rise through the ranks quickly. As such, you can gain experience and develop your CV with one eye on the future.
In such a situation, there may be some wisdom in working for a lower wage for a period of time in your career. Once you have progressed into a senior role and gained the experience you need at that level, a whole range of attractive opportunities may emerge. You may have the chance to take on a leadership or management position in a much larger organisation, and benefit from a significant pay rise at this point in time.
Making your decision
Even after knowing as an accountant, what you should be earning, it isn't always the overriding priority; the sole factor at the forefront of their mind when conducting career planning. Others may be inclined to take a longer term view, prioritising professional development and promotion opportunities rather than simply trying to maximise their income.
There is no doubt that salary is important for accountants, and as a skilled professional who provides an important service, you deserve to be suitably remunerated. If you are being underpaid for the work you do, it is worth considering your options - whether this involves switching employers or negotiating a well-deserved raise. In the current market, with employers competing for talent, there are clear opportunities to do both.
But applying for a new job - or staying in one you don't enjoy - purely for the money is always a risky strategy. You need to be sure it is a role you are interested in, and one in which you are motivated to perform. Sacrificing job satisfaction and development opportunities for higher pay can have negative consequences, harming your career in the long term. Just be sure the career decisions you make are for the right reasons.