Bonus hopes in the City of London may need to revisit reality. A number of senior workers in the City of London, mainly as a managing director level, who were hoping to receive bonuses increase as Square Mile hiring has increased may be setting themselves up for a letdown, according to recruiters.
According to Astbury Marsden, the managing directors, or those just behind the board level, figured that bonuses would be up by 44 per cent overall in the coming year round, even though there was pressure from the public and from shareholders to reduce the payouts given. However, it added that despite better economy prospect for the City, these workers may be hoping for too much. According to a report published this month from the Financial Times, investment banks were probably going to cut the bonus pools by 10 per cent or more.
A separate financial recruitment firm, Morgan McKinley, stated that the new openings in the previous month were increased by 30 per cent compared to the same time last year, which was a potential change for the City’s prospects, given a 25 per cent loss in jobs since the global financial crisis began. The pouring of optimism in the City has also been bolstered by higher levels of economic confidence, in addition to more initial public offerings and a stock market that appears more positive and lively than it had been in the recent past.
According to Morgan McKinley, workers who were able to find new jobs last month noted an average salary increase of 15 per cent, which was greater than the 12 per cent found in the month before. It also noted that staff thought a bonus pool that was larger was more likely. The operations director of Morgan McKinley’s financial center, Hakan Enver, noted that although there was a slight drop in the availability of jobs just before Christmas, when results were compared to results a year ago, the hiring levels at the City had gone up by a meaningful amount.
He added that clients were looking forward to larger volumes of jobs from January into the future. He stated that there was a general feeling that there would be much greater levels of recruiting beyond simply hiring to replace people who had been lost, which was what tended to be the norm for much of the year. According to Mr.Enver, a lot of the volume would keep on being temporary and contract based, and within the areas of finance, accounting, projects, information technology, and strategy. There is still a strong level of demand for staff who are trained in compliance, as companies continue to need to meet regulation demands.
Astbury Marsden noted that managing directors could expect an increase in the amount of average bonus they would receive to £167,000. This amount was an increase to 115 per cent of the typical salary of a managing director. The amount was a significant jump from just a year ago, when the average bonus was an already hefty 88 per cent of the average salary figure. City employers also planned on providing higher levels of reward in order to discourage senior staff to leave. The boost to basic pay as a result of job moving was 29 per cent for managing director level staff in 2013, which was another significant increase compared to the figure a year ago in 2012, which was 15 per cent. All in all, if you are disappointed by your bonus this year, your basic salary might allow you to get over.