Bosses' pay still rising more quickly than staff wages
Executive pay is set to continue rising more quickly than the salaries earned by the majority of workers over the next 12 months, new research suggests, fuelling the controversy over the widening gap between those at the top of organisations and their staff.
Research from Pricewaterhouse Coopers (PwC) reveals that four-fifths of pay consultants specialising in executive pay expect the rewards offered to the executives of FTSE 350 companies to increase next year, with base pay set to rise between 2-4%, ahead of the average salary rises expected for workers as a whole.
PwC has yet to publish details of executive pay increases during 2011, though anecdotal evidence suggests they have been rising at a similar rate. Last year, the average FTSE 350 executive got a 2.8% pay rise, but was also likely to have received a significantly bigger bonus than previously - pay-outs rose 30% for FTSE 100 directors.
In the coming year, there will be some executives who do not share in the windfalls, PwC said, with around 13% of companies expected to freeze the pay of their senior staff. Bonus increases across the board are also expected to be smaller.
Nevertheless, the suggestion that executives are set to go on receiving larger pay rises than the staff who work for them will anger those who believe remuneration policies have become slanted towards the wealthy.
Vince Cable, the Business Secretary, has expressed concern about executive pay, with the average director of a British company now earning 69 times as much as his typical employee.
The comparative figure in Sweden, for example, is only 34 times.
Mr Cable has already said he will table proposals aimed at addressing the discrepancy this autumn, while the High Pay Commission, an independent investigation into the same issues, is also due to report its findings.