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Mikhail Liebenstein

Pay pressure on businesses in the UK

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Anyone had evidence of pay rising in their industry caused by a skill shortage? There was an article about it on LBC yesterday, though the most recent piece in the paper I could find was this https://www.telegraph.co.uk/business/2018/07/06/staff-shortage-causes-surge-pay-rises/

In my sector, and mainly relating to sales and technical sales there is definitely an upward trend. Whilst some try to hire millennials and skill them up (which can be tough) others just bite the bullet and pay more for skilled workers.

Working for a multinational this isn’t such a big issue as UK costs have actually fallen due to sterling’s drop, but i guess for smaller UK firms it will be tougher.

I myself have just been offered a new role, which I need to accept by next week -,the base pay is roughly 40% higher and the OTE is nearly double.

 

 

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Yes, in Engineering very much so. Having to offer quite high wages for the newcomers that we struggle to recruit, but luckily this is also feeding into pay rises for existing staff to retain us. 

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The Boe/Carney view is, I believe, that so many people are working part time that there's loads of slack in the work force so wage inflation can't get engrained. Therefore they're sticking with low IRs. We'll see heh.

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My standard low skilled skill shortage indicator is bus driver.

Everywhere has Wanted Ads.

As far as skilled, which in my case is mainly software, the shortages are so extreme you need to increasing wages by 10%y or risk loosing most of your softies.

 

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Just now, Si1 said:

The Boe/Carney view is, I believe, that so many people are working part time that there's loads of slack in the work force so wage inflation can't get engrained. Therefore they're sticking with low IRs. We'll see heh.

Fine for Tesco tills and other retail.

Go above that and ...,

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Yes, in software development / support / IT. I was speaking to an ex colleague who said they just can't get the right people. He said they have 'developers' who have been on 'probation' for over a year and they would like to replace them. They are offering higher salaries than the current good developers are on. I guess they need to up it more. They do use contractors, which pushes up labour costs also.

Edited by Captain Kirk

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I think finally the *insanity* of Silicon Valley salaries is drip feeding into tech over here. It needs to.

Want a bit of fun?

https://h1bdata.info/index.php

this site gives access to salary data registered h1b visas employed by US firms, as required by federal law.

look at Netflix salaries for software engineers, and wait for the jaw to drop.

if you are in a US firm over here, it’s your civic duty to point out what extraordinary value you are (if you’re any good at what you do) compared to them and get your slice of the pie. 

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I imagine anything a bit tech related is going to be at the forefront of this, basic industrial in the middle, and financial services at the rear due to a decade of so of being sand bagged by increasing capital requirements and governance expenses.  When/if wage inflation comes back for banks/insurers then this will surely be the end of super low interest rates.

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28 minutes ago, spyguy said:

My standard low skilled skill shortage indicator is bus driver.

Everywhere has Wanted Ads.

Bus driver is an odd one. May be considered 'low skill' but for the money would you want to be responsible for the safety of your passengers, dealing with violent / abusive passengers and having to stick to timetable for not a massive amount of money? I know I wouldn't.

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5 minutes ago, Ghostly said:

Bus driver is an odd one. May be considered 'low skill' but for the money would you want to be responsible for the safety of your passengers, dealing with violent / abusive passengers and having to stick to timetable for not a massive amount of money? I know I wouldn't.

Funny one.

If its a long distance country bus then its a nice job.

If its a city bus ....

It is decent money for the skills required.

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10 minutes ago, Frugal Git said:

I think finally the *insanity* of Silicon Valley salaries is drip feeding into tech over here. It needs to.

Want a bit of fun?

https://h1bdata.info/index.php

this site gives access to salary data registered h1b visas employed by US firms, as required by federal law.

look at Netflix salaries for software engineers, and wait for the jaw to drop.

if you are in a US firm over here, it’s your civic duty to point out what extraordinary value you are (if you’re any good at what you do) compared to them and get your slice of the pie. 

Nice, the best I saw was $280k.

I am not going to say exactly what i’ve been offered, but it is similar digits to above, just in Sterling.

 

 

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7 minutes ago, Ghostly said:

Bus driver is an odd one. May be considered 'low skill' but for the money would you want to be responsible for the safety of your passengers, dealing with violent / abusive passengers and having to stick to timetable for not a massive amount of money? I know I wouldn't.

No.  If ever there was a job for thick skinned migrants from Africa it’s that one.

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15 minutes ago, Frugal Git said:

I think finally the *insanity* of Silicon Valley salaries is drip feeding into tech over here. It needs to.

Want a bit of fun?

https://h1bdata.info/index.php

this site gives access to salary data registered h1b visas employed by US firms, as required by federal law.

look at Netflix salaries for software engineers, and wait for the jaw to drop.

if you are in a US firm over here, it’s your civic duty to point out what extraordinary value you are (if you’re any good at what you do) compared to them and get your slice of the pie. 

Nice find - for certain employers with accurate job titles you can work out exactly what colleagues are paid which is interesting.  For balance I bunged in Goldman Sachs and Google and I would conclude that you will see high salaries for any leading US employer.  Side point - but Google seems to have almost infinite results - much hiring.  Plus GS cleverly disguises the results with generic job titles and salary bands.

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3 minutes ago, Mikhail Liebenstein said:

Nice, the best I saw was $280k.

I am not going to say exactly what i’ve been offered, but it is similar digits to above, just in Sterling.

 

 

Worth looking at the 2017 data as well....there’s $350k senior software engineers in some firms. 

Not forgetting that's the base. Add equity into the mix and you can double some of those figures.

Very useful stuff when negotiating in my experience....there’s no harm in pointing out how trashy our salaries look in comparison if you deliver it with a 😉

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30 minutes ago, GARCH said:

.  When/if wage inflation comes back for banks/insurers then this will surely be the end of super low interest rates.

It won't because they were previously rentiers and being automated away and exported.

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1 hour ago, Captain Kirk said:

Yes, in software development / support / IT. I was speaking to an ex colleague who said they just can't get the right people. He said they have 'developers' who have been on 'probation' for over a year and they would like to replace them. They are offering higher salaries than the current good developers are on. I guess they need to up it more. They do use contractors, which pushes up labour costs also.

London and the SE?

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IT skills I would think are required by all firms big and small....like a business that is good at what they do/specialise in will not be always good at finance, legal or IT they require the skilled and knowledgeable in those particular fields.....fraud prevention, safety, marketing and sales etc......so why so many skills shortages? Perhaps the highly skilled do not need the money, they do not want the stress, they want to diversify into other things while they are still young enough and are able.....quality time and freedom, doing something always wanted to do but was not free to do it.... worth more than money?;)

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Crossing threads a bit but ....

Weve imported 10m 'Drs n Eng' over last 15y and despite lowering unkilled wages, increasing costs of housing, they appear to have s0d all effect on skills supply.

Hmm.

Im getting nagged to on a free all inc trip to Estonia to get pitched jobs to move there.

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1 hour ago, GARCH said:

Nice find - for certain employers with accurate job titles you can work out exactly what colleagues are paid which is interesting.  For balance I bunged in Goldman Sachs and Google and I would conclude that you will see high salaries for any leading US employer.  Side point - but Google seems to have almost infinite results - much hiring.  Plus GS cleverly disguises the results with generic job titles and salary bands.

With GS loads of pay is bonus rather than salary.

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34 minutes ago, spyguy said:

Software, US

https://m.slashdot.org/story/345632

Just shows how times have changed.

10 years ago, fungible, plenty in India...

Just shows what 10 years of working with Indian outsourcers does to the c suite.....

The reality is most corporate activity is centred around software.

Indian salaries are skyrocketing compared to sterling ones too, as are Eastern European ones, global arbitrage is almost over (other than sv). A significant proportion of h1bs are probably from those countries too, and those people are no idiots when it comes to money - they'll ask for and get  the US grade salary. The number of Indians now in the c suite at US software companies shouldn't be a suprise to anyone.

The accumulation of Technical debt isnt a phenomenon exclusive to outsourced software houses. It's everywhere because people/managers push out alphas as finished software and most engineers (regardless of where they are from) are too weak to fight against that. They'll just moan.

Nah, Sh1t engineers are everywhere. They'll see some inflation in their salaries for sure, but the rockstar engineers now can command silly money - for them there is no 'market rate'. It's up to the individual though to be honest with themselves and work out whether they should shut up and take the crumbs or if they are really worth a slice.

Edited by Frugal Git

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1 minute ago, Frugal Git said:

Indian salaries are skyrocketing compared to sterling ones too, as are Eastern European ones, global arbitrage is almost over. A significant proportion of h1bs are probably from there too, and those people are no idiots when it comes to money - they'll ask for and get  the US grade salary. The number of Indians now in the c suite at US software companies shouldn't be a suprise to anyone.

The accumulation of Technical debt isnt a phenomenon exclusive to outsourced software houses. It's everywhere because people/managers push out alphas as finished software and most engineers (regardless of where they are from) are too weak to fight against that. They'll just moan.

Nah, Sh1t engineers are everywhere. They'll see some inflation in their salaries for sure, but the rockstar engineers now can command silly money - for them there is no 'market rate'. It's up to the individual though to be honest with themselves and work out whether they should shut up and take the crumbs or if they are really worth a slice.

Yep.

Cheap high skills were always going to be temporary.

Fall of USSR, freeing up loads of tevhnical types, cheap comms for Indians.

My mum used to associate Indians with tea and curry. Now its phone scammers. Times change.

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Working at a Civil Engineer practice atm (4th time back :D). The place has gone full steam into pre-grads and school leavers. Employee boss got a 5% rise, I got nadda (contract).

Last time i asked for a rate increase it took 8 months (there was no train travel, 20 mins from home so I let it slide). Currently I'm £5 below market rate and there is no agency so that's another £5-7 on top (their loss lol). This time round I am winding down ... and leaving the industry completely.

Funny enough I was working at this place pre 2008. 6 months after my contract ended they laid off 80% of the bread and butter Technicians (CAD) and hired ..... yup a shed ton of pre-grads and school leavers.

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3 hours ago, Frugal Git said:

I think finally the *insanity* of Silicon Valley salaries is drip feeding into tech over here. It needs to.

Want a bit of fun?

https://h1bdata.info/index.php

this site gives access to salary data registered h1b visas employed by US firms, as required by federal law.

look at Netflix salaries for software engineers, and wait for the jaw to drop.

if you are in a US firm over here, it’s your civic duty to point out what extraordinary value you are (if you’re any good at what you do) compared to them and get your slice of the pie. 

Those Netflix salaries are insane. But I also took at look at Hewlett Packard Enterprise (I worked there for years) and the salaries they have in that database are way, way, way higher than what we were on in the UK for the equivalent positions - more than double in most cases I could see. Didn't stop them replacing any experienced people with grads on £25K though.......

Edited by dpg50000

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2 hours ago, Si1 said:

It won't because they were previously rentiers and being automated away and exported.

Certainly for some parts, but far from for all.

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