Salaries concern financial services firms

The cost of salary increases is the main employee-related concern of international banks and financial services companies, according to an Ernst & Young survey of 95 financial institutions. The survey covers remuneration levels for more than 1,000 people in 83 job titles, with 88 per cent of respondent companies coming from within the International Financial Services Centre (IFSC) in Dublin. Mr Philip Galvin, an Ernst & Young managing consultant, said "across-the-board" salary increases were of the order of 9.9 per cent, ahead of the inflation rate of about 3 per cent. Within the job title of chief executive, salary increases ranged from 7 per cent to 11 per cent. The upper quartile salary increased from £102,000 in 1997 to £110,00 this year.

But many increases were due to changes in duties and responsibilities "or retaining people with special skills sets", Mr Galvin said.

Retention of payroll costs and the struggle to hold on to employees who had highly marketable jobs were employers' main concerns.

"Skills shortfalls can relate to the business-development-manager type category, the fund administration area, IT people.

"There is a snowstorm out there at the moment for IT people," he added.

He said 86 per cent of companies applied an incentive or bonus scheme and 47 per cent of job holders were paid a bonus. "Over half of all the jobs surveyed in the IFSC were paid a bonus of some type," he said.

The survey shows chief executives of IFSC banks receiving an average salary of £88,829 and 93 per cent being paid a bonus. Among non-IFSC companies, the average salary for chief executives was £113,175, but just 50 per cent were on a bonus scheme. A business development manager in the banking sector, with up to 10 years' experience, receives an average £42,536 salary. A third of IFSC personnel in the same post receive a percentage of the salary paid as a bonus, compared to 11 per cent of those outside the IFSC.

The lowest average basic salary paid is £14,791 for non-IFSC receptionists/telephonists, a third of whom are on a bonus scheme. In the IFSC insurance category, the lowest salary - at £19,139 - is paid to a senior secretary, with 79 per cent being paid a bonus.

According to the Financial Services Industry Association annual report, there are 5,000 people employed in the IFSC in 400 different projects. There are 110 banking & asset financing companies. Mr Galvin added that a number of the IFSC companies surveyed were now 10 years in the centre. "It has come of age. The people in the sector do believe that they have a long and bright and prosperous future."