Winners and Losers as Britain Plays Salary Snakes & Ladders

November 20, 2012   Business News
(PRLEAP.COM) The percentage pay gap between the public and private sector has widened since the last boom, according to analysis of ONS data carried out by Randstad, the UK sector specialist recruiter.

  • Public sector pay increases have outpaced those in the private sector by 5.7% since 2006
  • Average UK salaries have risen by 11.4% since 2006 but slid 8 percentage points below inflation
  • CEOs' salaries have increased by just 1.3% - a real terms fall of 18%

  • Average annual salaries in the public sector have increased by 15.9% since 2006 compared to 10.2% in the private sector.

    Mark Bull, UK CEO of Randstad said: "It's tempting to think of the prolonged post credit crunch period as one long flat patch with static salaries to match. But actually it's been more like the board game snakes and ladders. For example, whilst the private sector was hit harder by the global economic crisis and saw salary gains slide back rapidly, pay increases of public sector employees remained insulated for a longer time. But with more public sector cuts to come in this parliament, the pattern could easily reverse. It's also not just a simple story of public versus private remuneration. In every sector there are pockets of people whose skills have seen them in increased demand, driving their pay up at a different rate to others."

    Randstad's analysis also identified the occupational groups which, according to ONS, have seen the largest and smallest pay rises since 2006, the last full year before the credit crunch.

    Average Pay

    The average annual salary of a UK employee has risen by 11.4% compared to before the credit crunch. Despite the improvement, the average UK employee is worse off in real-terms. Inflation has outstripped pay by 7.9 percentage points, and the average pay rise would have needed to be 19.3% simply to keep track with the rising cost of living over the period.

    Average pay inflation since 2006 has varied across the UK. The North East has seen the biggest percentage increase, with pay climbing by 12.3%, while London has seen the largest cash terms increase, growing by £3,982 (11.6%). The East of England and the North West have been the most sluggish, rising by 8.9 and 9.1% respectively. However, even in the North East, the best performing area, pay has risen 7 percentage points below the rate of inflation.

    Mark Bull adds: "Salaries have improved in the last year, but they are still a long way from matching the rising cost of living as companies look to keep costs as low as possible in the difficult economic environment. But it's vital that economic prudence in the short-term is balanced with long-term goals. Recruiting and retaining the best talent is a crucial component to a company's success, and looking to cut corners financially can often be a false economy, undermining staff morale and the quality and productivity of the workforce."

    Notes to editors

    The Randstad group is one of the leading recruitment & HR services providers in the world with a top five position in the UK and a top three position in fifteen countries including the US, France and Germany.

    In the UK, Randstad's business lines serve the public and private sectors across Accounting and Financial services; Business Support; Construction, Property and Engineering; Education; Health and Social Care; Interim Management and Search; Human Resources; IT; Legal; Retail; Sales, Marketing and Creative; Student and Worker Support and In-House and Managed Services.

    At the end of 2011, Randstad had 1,930 corporate employees in the UK, working in 255 locations. UK revenue in 2011 was 789 million. Randstad was founded in 1960 and is headquartered in Diemen, the Netherlands. Randstad Holding nv is listed on the NYSE Euronext Amsterdam. For more information see and

    Press contacts

    The Wriglesworth Consultancy

    James Staunton, Associate Director, 020 7427 1404
    Dan Pike, Account Manager, 020 7427 1430
    Adam Jones, Account Executive,
    020 7427 1403
    Contact Information
    James Staunton
    020 7427 1404
    Contact Us