UK moves up European pay league


The UK has improved its position in the European pay league in the last 12 months, according to research by consultancy Towers Watson.

Its Global 50 remuneration planning report found that base salaries for professional staff in the UK at both entry and middle-manager level are now ranked thirteenth and seventh, respectively, out of the top 15 European economies, compared to fifteenth and tenth in 2013.

However, the UK remains near the bottom of the salary grid for entry-level employees, despite rising above Spain and Italy in 2014.

The research also found:

  • Entry-level pay is Switzerland is more than twice of what equivalent UK worker could expect to earn (£66,671 per annum (pa) compared to £27,199 pa).
  • The UK continues to lag significantly behind the rest of the top five, Denmark, Luxembourg, Norway and Germany, for entry-level pay.
  • For middle-management base salaries, the UK ranks higher than the Netherlands, Austria and Ireland in 2014.
  • Despite the UK’s upward movement in this ranking, base salaries remain over £10,000 pa behind the top three European countries: Switzerland, Luxembourg and Germany.

Darryl Davis, senior consultant in Towers Watson’s data services team, said: “While our latest gross salary data does show some positive movement for the UK, on the European level there still remains a considerable gap in gross salary terms between it 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.” 

Carole Hathaway, global leader of Towers Watson’s rewards practice, said: “Our most recent study shows that base pay remains the number one consideration for individuals when they are deciding to join or leave an employer.

“The 2014 pay league tables suggest that UK employers are responding to certain pay pressures in terms of their base salary within the constraints of a challenging economy.

“However, employers do have the opportunity to further increase the perceived value of their overall offer by enhancing the non-financial aspects of the deal such as career advancement opportunities, learning and development programmes and flexible-work arrangements, and to communicate the deal more effectively to employees.”