City job movers have reaped the rewards of moving jobs as the labour market heats up further, according to new data to be published today.
Salaries for City workers moving jobs have increased by 17 per cent, according to the latest data from recruitment firm Morgan McKinley – equivalent to an average pay bump of £12,000 for job movers.
Recruitment firms have reported higher salaries for people starting new jobs for 75 consecutive months, according to separate data to be published today by the Recruitment and Employment Confederation (REC).
The REC’s data, which is closely followed by the Bank of England’s monetary policy committee, will show steep rises in demand for staff across every job category it tracks, with strong rises in accounting and financial as well as executive and professional roles.
Pay growth rose strongly, with an index tracking the rise in average salaries at 60.2, well above the 50 no-change mark, albeit down from the recent high hit in May.
Hakan Enver, managing director at Morgan McKinley, said City pay dynamics can diverge from the broader economy, with compliance, risk and tech roles seeing big increases in pay offers.
Firms’ “hands are tied” when it comes to regulatory requirements in particular, meaning they have to pay whatever it takes to attract staff even amid uncertainty over the future of the post-Brexit migration regime.
The UK labour market is currently at its tightest in four decades according to most standard measures, with many economists, including the Bank of England, expecting rising wages in the coming months.
Outgoing Bank of England rate-setter Ian McCafferty yesterday said it would be “reasonable” for financial markets to expect two rate rises over the next two years, amid “a rise in inflationary pressure”.
The economist, who will leave the Bank at the end of the month, has led calls within the monetary policy committee (MPC) to raise rates, based on a tight labour market.
"We're only talking over the next couple of years of possibly a couple more small interest rate rises over that period. That's what the markets are expecting and I think that's a reasonable rule of thumb if the economy performs as we expect," McCafferty said, speaking on LBC radio, Reuters reported.
Sophie Wingfield, the REC’s head of policy, said: “We’re still seeing demand for staff is on the rise for every sector.”
“For candidates it is a really good time to look for a new job,” she added, with the salary rises seen by recruitment consultants likely to be reflected across the broader economy.