Salary Boost for 'e-People' in Britain
(EMAILWIRE.COM, November 27, 2000 ) Britain's e-Businesses are planning pay rises more than twice the national average in a bid to retain their staff in the face of continuing bad news stories about the prospects for the sector. According to the latest "e-People" survey from Hay Management Consultants, increases in base salaries in e-Businesses are set to average 9.7% when next reviewed, compared with an average projected increase across the Industrial and Service Sector of 3.6%. The average increase for e-people over the twelve months to July 2000 was 7.2%. For the CEOs and heads of e-Businesses (whether an in-house department, a business unit within a larger organisation or an internet start- up), the rises in base salary are expected to be even higher, averaging 13.6% at next review.
Greater Risk in Working for a Dot.com Means Higher Pay
Iain Smith, Management Consultant at Hay Management Consultants commented: "These rises will widen an already significant gap in pay between "e" and "non-e" roles of equivalent responsibility and seniority. The greater risk of working for a dot.com was already resulting in much higher pay for the vast majority of roles, compared with their old economy equivalents, when we conducted our first e-People Survey in January of this year. Since then, people have become more aware of the risks involved in dot.com companies.
"Share options - once a useful means for cash poor internet start-ups to keep their salary bills down, now hold less attraction. As a result, e-Businesses are being forced to increase base salaries by percentages well above the national average in order to remain competitive in the war for talent."
Other major findings of the survey include:
Demand for e-Skills Remains High
Despite the downturn in dot.com share prices, the demand for e-skills has not subsided. 62% of the organisations questioned said that resourcing was their highest priority. 37% gave expansion as their main reason for recruiting. 34% cited staff turnover and 28% new business opportunities.
Staff are Paid More in Standalone Dot.coms
Staff in stand alone dot.coms are more highly paid than staff in other e-Businesses and are also more incentivised, with base salary being a smaller percentage of total remuneration. The CEO of a standalone internet company receives total cash averaging £180,000, of which 25% is short term incentives and bonuses. By comparison, the head of an internal department specialising in e-Business is paid a lower mean total cash salary of £103,711, of which only 12% is incentives and bonuses.
Highly Differentiated Reward is a Feature of This Market
The difference in pay between employees at the lowest and highest grades tends to be greater in an e-Business environment than in a traditional business, despite the emphasis on team values and a friendly, informal culture. Web Masters, for example, on average earn only 18% of the average paid to the head of the business, compared with 26% when examining roles of a similar job size within Industrial and Service organisations.
Skills Commanding Market Premia
85% of the organisations surveyed listed Java as a skill that commanded a market premium. This has fallen from 94% in January's e-People Survey. 75% and 55% respectively said that Javascript and HTML commanded market premia
Notes to Editors:
1. Hay Management Consultants surveyed 71 organisations in its July 2000 e-People Report.
2. Hay Management Consultants is the UK's largest consultancy specialising in people, performance and work. The company has international expertise in reward management, leadership development, organisational effectiveness and change management. It has been operating in the UK for over 30 years and employs 150 management consultants (and over 30 information analysts and consultants). There are offices in London (UK headquarters), Birmingham, Bristol, Glasgow, Manchester and Windsor. Hay Management Consultants is a member of the Hay Group, one of the world's leading independent management consultancies, with 74 offices in 33 countries.
-------------------
Produced for Hay Management Consultants
Contact:
Iain Smith
Ph: 44 (0)20 7881 7177
iain_smith@haygroup.com
-------------------
Greater Risk in Working for a Dot.com Means Higher Pay
Iain Smith, Management Consultant at Hay Management Consultants commented: "These rises will widen an already significant gap in pay between "e" and "non-e" roles of equivalent responsibility and seniority. The greater risk of working for a dot.com was already resulting in much higher pay for the vast majority of roles, compared with their old economy equivalents, when we conducted our first e-People Survey in January of this year. Since then, people have become more aware of the risks involved in dot.com companies.
"Share options - once a useful means for cash poor internet start-ups to keep their salary bills down, now hold less attraction. As a result, e-Businesses are being forced to increase base salaries by percentages well above the national average in order to remain competitive in the war for talent."
Other major findings of the survey include:
Demand for e-Skills Remains High
Despite the downturn in dot.com share prices, the demand for e-skills has not subsided. 62% of the organisations questioned said that resourcing was their highest priority. 37% gave expansion as their main reason for recruiting. 34% cited staff turnover and 28% new business opportunities.
Staff are Paid More in Standalone Dot.coms
Staff in stand alone dot.coms are more highly paid than staff in other e-Businesses and are also more incentivised, with base salary being a smaller percentage of total remuneration. The CEO of a standalone internet company receives total cash averaging £180,000, of which 25% is short term incentives and bonuses. By comparison, the head of an internal department specialising in e-Business is paid a lower mean total cash salary of £103,711, of which only 12% is incentives and bonuses.
Highly Differentiated Reward is a Feature of This Market
The difference in pay between employees at the lowest and highest grades tends to be greater in an e-Business environment than in a traditional business, despite the emphasis on team values and a friendly, informal culture. Web Masters, for example, on average earn only 18% of the average paid to the head of the business, compared with 26% when examining roles of a similar job size within Industrial and Service organisations.
Skills Commanding Market Premia
85% of the organisations surveyed listed Java as a skill that commanded a market premium. This has fallen from 94% in January's e-People Survey. 75% and 55% respectively said that Javascript and HTML commanded market premia
Notes to Editors:
1. Hay Management Consultants surveyed 71 organisations in its July 2000 e-People Report.
2. Hay Management Consultants is the UK's largest consultancy specialising in people, performance and work. The company has international expertise in reward management, leadership development, organisational effectiveness and change management. It has been operating in the UK for over 30 years and employs 150 management consultants (and over 30 information analysts and consultants). There are offices in London (UK headquarters), Birmingham, Bristol, Glasgow, Manchester and Windsor. Hay Management Consultants is a member of the Hay Group, one of the world's leading independent management consultancies, with 74 offices in 33 countries.
-------------------
Produced for Hay Management Consultants
Contact:
Iain Smith
Ph: 44 (0)20 7881 7177
iain_smith@haygroup.com
-------------------
Contact Information:
Hay Management Consultants
Joseph Nchor
Tel:
Email us
This is a press release. Press release distribution and press release services by EmailWire.Com: http://www.emailwire.com/us-press-release-distribution.php.
Hay Management Consultants
Joseph Nchor
Tel:
Email us
This is a press release. Press release distribution and press release services by EmailWire.Com: http://www.emailwire.com/us-press-release-distribution.php.
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