CIMA UK part qualified salary survey 2009 · 2010. 1. 26. · CIMA level In-line with observations...

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CIMA UK part qualified salary survey 2009

Transcript of CIMA UK part qualified salary survey 2009 · 2010. 1. 26. · CIMA level In-line with observations...

Page 1: CIMA UK part qualified salary survey 2009 · 2010. 1. 26. · CIMA level In-line with observations on studying status and years’ experience, the more senior the level of CIMA attainment,

CIMA UK part qualified salary survey 2009

Page 2: CIMA UK part qualified salary survey 2009 · 2010. 1. 26. · CIMA level In-line with observations on studying status and years’ experience, the more senior the level of CIMA attainment,

CIMA Salary Survey 2009 - UK

Foreword 1

Executive summary 2

Main findings 4

Salaries and bonuses 4

Years’ experience 4

Gender 5

Sector 5

Regions 6

Size of business 6

Job roles 7

CIMA level 8

Recruitment and retention 9

Satisfaction with salary 9

Satisfaction with benefits 10

Importance of benefits 11

Promotion prospects 12

Working hours 13

Primary motivators 14

Motivator by region 15

Skills set requirements 16

Geographical mobility 17

Extent of movement 17

Destination 18

Economic future 19

Anticipated impact 19

One word to describe success 20

UK salary information 21

Technical information 22

Further Information 22

Page 3: CIMA UK part qualified salary survey 2009 · 2010. 1. 26. · CIMA level In-line with observations on studying status and years’ experience, the more senior the level of CIMA attainment,

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Foreword Welcome to the UK results of the Chartered Institute of Management Accountants’ (CIMA’s) inaugural global salary survey. The results contained within this report have been created to provide you with a snapshot of the trends faced by the business leaders of tomorrow – CIMA’s UK student base.

The world has faced a tough 12 months and has seen Finance Directors thrust centre stage as organisations around the world look to weather the storms ahead. The role of the professional management accountant has never been more critical to the

economy’s success, so it is encouraging to note that 2008 saw CIMA recruit its highest ever number of students.

As the world’s leading and largest professional body of management accountants, CIMA is this year celebrating its 90th anniversary. The Institute has lived through various recessions and upheavals, including the great depression of the 1930s. Experience tells us that bad times also bring opportunities and vital lessons that will benefit us in the future.

This report, which focuses on CIMA students in the UK, identifies a number of important trends. The average CIMA student’s remuneration package is £33,513 per annum with passed finalists earning around 42% more than managerial level students. Independent research, conducted earlier in the year, showed that CIMA is leading the way when it comes to salary earnings, and our global research shows that around three fifths of respondents are satisfied with their salary. It is encouraging to note that 43% consider their promotion prospects to be good or excellent, with optimism rising in line with the CIMA level attained.

CIMA students appear to be masters of their own destiny. Although four fifths are confident they can keep their current position for the ensuing 12 months, around 50% are considering moving on over the next two years.

While these statistics give an interesting snapshot of our UK students’ thinking, we must bear in mind the greater need for parity between male and female student earnings, which was also thrown up in the report.

As CFOs around the world look to build long-term strategies alongside managing the challenges of day-to-day operations in the current economic climate, CIMA students are very much in demand. Their ability to work at the heart of an organisation to help drive its success coupled with the international scope of the qualification makes them the number one choice for business. On every level.

Please read on for a more detailed insight into what makes our UK students tick. I hope you find it an interesting read.

Charles TilleyChief ExecutiveCIMA

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Executive summaryThe Independent Treasury Economic Model (ITEM) Club warned that the UK economy is ‘skating on thin ice’ in April 2007 and since then the economy has seen many changes. Management accountants are of course some of the most directly affected by economic change.

Organisations are having to ensure a delicate but crucial balance between short-term survival and securing their long-term future. While there is enormous pressure to cut costs, investing in the training and development of the financial business leaders of the future has never been more important. With this in mind CIMA sought to gauge its students’ views of the current climate and understand their salary levels and aspirations.

In February 2009 CIMA launched its first ever global salary survey for students. A total of 2,093 people contributed to the survey of which 1,235 were in the UK, establishing a reliable benchmark of current and future salary potential for CIMA students. This report summarises the results of this survey, with a particular focus on the UK. The report looks at the salaries and bonuses paid to CIMA students throughout the UK and how these vary according to factors such as sector and size of business. It then goes onto examine recruitment and retention issues and identifies the geographical mobility of CIMA part qualified. Finally, it touches upon views on the future economy.

Salaries and bonuses

The average CIMA students’ annual salary is £32,074.

The average bonus is £1,439 across all students.

46% are not expecting to receive a bonus at all in 2009. For those expecting a bonus, the average is £2,682.

By sector, those employed in the technology, telecoms and utilities, banking, finance and accountancy, and natural resources, energy/fuel sectors earn, on average in excess of £35,500 per annum.

Passed finalists earn around 42% more than managerial level students (£41,500 compared to £29,320).

Regions have a greater impact on salary level and bonuses than industry sector - average packages in London are £40,702.

Men earn £2,830 more in their basic salary than women. When bonuses are taken into account the disparity rises to £3,474 per annum.

Recruitment and retention

Around three fifths of respondents claim to be satisfied with their salary.The higher the basic salary or bonus, the more inclined they are to be satisfied or extremely satisfied with their salary – almost 30% more high tier earners (£45,000+) are satisfied or extremely satisfied than low tier earners of £30,000 or less.Three out of the four most desired package benefits are studying supports. Pension is the fourth factor.Pay rise as an incentive for passing exams is the expectation least being met; only 20% receive this, but it scores 4.2 out of five in terms of importance.An optimistic 43%, consider their promotion prospects to be good or excellent.The higher the CIMA level attained, the greater the optimism concerning promotion prospects.The key job motivator is training and development (16%), followed by challenging workload (14%), and financial reward (14%).Leadership (47%) and personal development (52%) are the main focus for skills development in the next 12 months.

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Geographical mobility

CIMA students seem to be masters of their own destiny. Although over four fifths are confident that they will keep their position during the coming 12 months, around half are considering moving. Also only 8% have job security as a primary career motivator.15% of UK CIMA students who are planning to move intend to go overseas in the next two years. Predominantly English speaking countries are the most popular choice: Australia followed by Canada, UAE and the USA, demonstrating the mobility of the CIMA qualification.

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Main findingsSalaries and bonuses

The average basic gross salary is £32,074, plus £1,439 bonus, producing a total average annual package of £33,513. The average is pushed up by a small proportion of individuals earning a basic salary of over £55,000 per annum (4%). Bonuses also vary, with an average of £1,430. Although with 46% not expecting a bonus in 2009 (particularly women 52%), this shows a high degree of polarisation in the data. The extent of bonuses received tends to increase with experience, rising from around 3% of salary within the first year of enrolling, to 5%, five or more years later.

Years’ experience

Salaries increase with experience, as one would expect. However, there appears to be an anomaly in the pattern for those who have enrolled with CIMA most recently. This might be as a result of employer’s cherry picking the better candidates, offering higher starting salaries than a year ago.

On average CIMA students annual salary is £32,074The average bonus is £1,439 across all respondents46% don’t expect to receive a bonus in 2009 For the 54% expecting a bonus the average is £2,682

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Those with five years experience, earn on average £10K more than those who have enrolled with CIMA in the last year.

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Gender

As in other areas of industry, females are not remunerated as highly as their male colleagues. In terms of average basic salary the difference is only £2,830. However, when bonuses are taken into account the disparity rises to £3,474 per annum.This inequality could possibly be a reflection of the increased likelihood of females working in organisations that have a smaller number of employees internationally.

Sector

CIMA is important to the broad base of UK industry with the banking, finance and accountancy sector having the highest proportion of CIMA students (19%), followed by manufacturing and engineering (16%), public sector and not-for-profit (13%) and retail and consumer goods (10%). At this stage within their career, salaries are comparable across a number of sectors, with technology, telecoms and utilities, banking, finance and accountancy, and natural resources, energy/fuel offering over £35,500 per annum. These industries also generate larger bonuses.

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On average, males are earning £2,830 than females.

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Regions

Regions have a greater impact on the level of salary and bonuses than industry sector. Predictably, with the higher cost of living and focus on the high earning banking markets, salaries and bonuses in London outstrip those of the rest of the UK. Average salaries in London are £38,494, plus £2,208 in bonuses bringing the mean package to £40,702. Surrounding regions have the next highest salary ranges. CIMA students most commonly work in London and the South East (44%), with the North West being the next most popular destination (11%).

There are a significantly higher proportion of men working in London and in larger organisations which may well be pulling up the average salaries in these areas.

Size of business

At this stage of an accountants’ career, basic salaries vary little according to the employer size, with a slight tendency for higher salaries in larger companies.

Average salaries in London are over a third higher than in Northern Ireland.

Geographical location seems to have the biggest impact on salary levels

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Job roles

CIMA students most commonly report their job title as management accountant (29%), finance or business analyst (15%) and accounts assistant (6%), demonstrating the strategic and diverse nature of CIMA roles. Financial controllers tend to have the highest combined package of £44,350. These particular respondents are more likely to be in a smaller organisation and be more mature in age.

In terms of fitting into the business, organisational structure is relatively traditional for respondents, as 87% of respondents sit in the finance division. The operations division was the only other department of note where 6% resided. A further 2% work out of the strategy division.

For those in the operations division, average packages are higher (£35,842 compared to £32,713 in the finance division). This may be accounted for by a notably higher proportion of management consultants and other non-finance managers in this area (22% and 41% of them compared to their 5% and 1% representation overall).

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CIMA level

In-line with observations on studying status and years’ experience, the more senior the level of CIMA attainment, the higher the salary. Passed finalists* earn around 42% more than managerial level students on average (£41,500 compared to £29,320). Bonuses are also larger the more senior the CIMA grade.In terms of responses to the survey, 7% were from Passed finalists, 47% strategic, 20% TOPCIMA, and 27% managerial.

* Passed finalist = a student who has completed all 3 levels of the CIMA qualification but who has not yet submitted their three year relevant work experience and as such not progressed to CIMA membership

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Passed finalists earn around 42% more than managerial level students on average.

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Recruitment and retentionSatisfaction with salary

Predictably for a profession concerned with finance, the higher the basic salary or bonus, the more inclined the individual is to say they are satisfied or extremely satisfied with their salary. Nearly 30% more high tier earners (£45,000+) are satisfied or extremely satisfied with their salary compared to low tier earners of £30,000 or less. Overall, three fifths of respondents claim to be satisfied.

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It seems that a salary differential of 66% exists between very dissatisfied and extremely satisfied respondents - a gap of around £18,000 exists between the two average salaries.It also seems that those on the first rung of the CIMA ladder are more satisfied once they have attained their first exam passes, than when they are at the managerial level. Although we have seen some disparity between salary remuneration across the genders, there is no difference in satisfaction levels.

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Satisfaction with benefits

Typically, respondents are more satisfied with their benefits than salary packages (70%, compared to 59% claiming to be satisfied or extremely satisfied). Again though, the higher the basic salary or bonus, the more inclined the individual is to say they are satisfied or extremely satisfied with their benefits package. However, the disparity between the satisfaction of high and low tier earners is not as great (18%).

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Satisfaction with benefits packages do not vary by CIMA level as much as salary satisfaction. However satisfaction does seem to increase in larger employers (73% of those in large organisations are happy compared to 56% of micro/small companies).

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Benefits importance

Although we have seen that satisfaction is influenced by salary level, it is clear that the surrounding benefits package is also important.Support with study via a range of methods are three out of the four most desired benefits received by students, pension being the fourth factor (particularly significant for those over 35years). By and large students are receiving two of the three study support incentives (76% receiving study leave and or contribution/payment of CIMA fees). The area where expectations are not being met is pay rise as an incentive for passing exams; only 20% receive this, but it scores 4.2 out of five in terms of importance. A bonus for passing exams is also received by a smaller proportion of students than would like it.None of the benefits suggested were scored as unimportant, i.e. less as 2.5 out of five.The areas where men seem more likely to receive benefits than women are share options (24% vs. 17%), life assurance (31% vs. 23%) and bonuses (49% vs. 38%). Significantly more men see car allowances and share options as important, whereas females see extra holiday, flexi time, working from home, and study benefits as significantly more important.

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Employers could improve satisfaction levels by offering pay rises or bonuses as an incentive for passing exams.

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Promotion prospects

A relatively optimistic 43%, given the current recession, consider their promotion prospects to be good or excellent with their current employer. Optimism appears to wane with age though, with over twice as many students under 25 upbeat about their prospects compared to those 45 and over (49% vs. 24%).

The more opportunities there are for internal movement, the more positive respondents seem to be about their future career prospects, as those in larger companies are more likely to be positive. Hard work and dedication to study also seems to bring with it increased optimism, as the higher the CIMA level attained seems to result in greater the self-assurance.

The greatest confidence is displayed by individuals who have moved to the UK within the last 12 months; 54% saying their prospects are excellent or good.

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Students optimism about their career prospects increases as they progress through the CIMA exam system.

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Working hours

The typical working week for the majority of respondents (52%) is 35-40 hours. A further 38% of students work between 41-50 hours, while only 4% work less than 35 hours a week. Students’ moderately short week, compared to more senior colleagues in the industry may be due to the fact that they have to fit in study time around the standard working week.

However, a third of students are under pressure to increase their workload outside normal hours.It would appear that the old adage of ‘the more you do the more you are expected to do’ is coming into play, with those already working the longer hours more likely to be expected to increase them. This is particularly the case for men.Large companies are more likely to increase their hours than sole traders (35% vs. 24%).

Increased workload can often be as a result of career progression with 70% of those anticipating increased hours having taken on increased responsibilities or a more pressurised position. However, the effect of the recession may well already be starting to be felt as understaffing/lack of resources was the next most common reason (56%).

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Primary motivator

Although two fifths of respondents are less than happy with their package only 14% of respondents state financial reward or benefits as their primary motivator. The key motivator is training and development (16%). Perhaps surprisingly, job security (8%) did not feature as greatly as one might expect in the current economic climate, possibly showing CIMA students’ confidence in their own employability.

Motivators change with life stage, with flexibility/work life balance becoming increasingly important with age (mentioned by 3% of under 25year olds, rising to 26% for those 45years plus). The converse is also true of training and development which drops from 31% for the under 25years to 5% for 45years plus. Not surprisingly, the desire for training also declines the further into the CIMA qualification the respondent is, with the need for financial reward increasing.

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It is important to maintain training and development budgets throughout the recession as it is the single most important CIMA student motivator.

CIMA students appear confident in their employability.

Page 17: CIMA UK part qualified salary survey 2009 · 2010. 1. 26. · CIMA level In-line with observations on studying status and years’ experience, the more senior the level of CIMA attainment,

Motivator by region

There are regional variations in career drivers, with financial rewards being the main priority for those working in London. In contrast, those working in the East of England are least likely to be concerned with money.Meanwhile Yorkshire and Humberside students are more focused on elements such as autonomy with scope of role/projects as their main motivation.

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1 = Key motivator2 = 2nd most important motivator etc

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Skills set requirements

CIMA students are well aware their future careers will need them to be good at elements other than just technical accountancy. Just over a third (36%) want to acquire persuading and influencing skills within the next 12 months, 39% would like to improve their decision making and/or communications, while 41% want to improve strategic planning and implementation. However leadership (47%) and personal development (e.g. career planning, time management) (52%) skills are the key focus for CIMA students.The more technical skills such as budgeting, reporting and analysis and internal audit are of greater importance for those at CIMA managerial level, as is problem solving. However, the converse is true for persuading and influencing, leadership, and developing others’ skills.The key difference by gender is propensity to require leadership skills training where 53% of male students want this compared to 41% of their female colleagues. Women are more inclined to focus on budgeting training (40% vs. 32%)

The key skill areas in the next 12 months for higher tier earners appears to be risk management, possibly because they are taking the current economic climate very seriously.

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Page 19: CIMA UK part qualified salary survey 2009 · 2010. 1. 26. · CIMA level In-line with observations on studying status and years’ experience, the more senior the level of CIMA attainment,

Geographical mobilityExtent of movement

Only 1% of respondents moved to the UK within the last 12 months, mainly from India and Ireland.

Over half of students (58%) intend to change jobs in the next two years (less so for the female respondents). For the majority of people moving, they expect to do so within the year, which might explain why job security is not a key motivator.

The vast majority of potential movers (85%) will stay within the UK for their next position. Nevertheless, with 15% intending to move outside the UK, the geographical mobility of the CIMA qualification is demonstrated.

Of those who intend to move out of the UK only 24% are confident they will stay within the same industry sector as present. For those intending to switch who have an idea of their desired industry, banking finance and accountancy and natural gas are the most popular.

Improvements in the quality of life are most regularly sought abroad (71%), as is the opportunity to experience different cultures (62%), showing that those considering moving overseas are driven by slightly different things to CIMA students overall.

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Those considering relocating are more concerned with lifestyle issues than traditional career progression.

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Destination

Of the UK CIMA students who are planning to move jobs in the next two years, 15% intend to move abroad. They are predominately likely to choose English speaking countries: Australia (45%) followed by USA (35%), UAE (23%) and then Canada (19%). CIMA offers local support in all these regions, whether through CIMA offices or a partnership agreement offering member network support. Looking at the global picture 9% of CIMA students are considering a career move overseas in total.

The majority only intend their relocation to be temporary (64%), typically between one and three years (51%). However, nearly two fifths (36%) anticipate the move to be permanent.

Mobility of CIMA qualification

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Canada

USA

UAE

South Africa

India

Singapore

Hong Kong

Australia

New Zealand

32%

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Economic furureAnticipated impact

Over four fifths of CIMA students are absolutely or fairly confident that they will keep their job in the next 12 months (83%), with confidence at a similar level across the CIMA grades. Neither does confidence vary by the extent to which students are satisfied with their salary or benefits package. However, those who consider their promotion prospects to be excellent are two and a half times more likely to be absolutely confident about their position than those who consider their promotion prospects to be average.Older students anticipate the credit crunch lasting longer than younger CIMA students, (as do women and high tier earners), perhaps as a factor of greater historic experience of previous recessions. The majority of people feel it will last a further one to two years (69%).

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During the current economic downturn, respondents expect their organisation to take a number of specific actions; most principally to cut budgets (63%), freeze recruitment (57%) and have profitability squeezed (51%). In terms of future investment cuts, this is more commonly predicted by the older students, almost half of 45 years+ expect cuts compared to only 27% of those under 25 years. Older respondents also feel staff training cuts are likely.

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One word to describe success...The size of the font reflects the number of times the word was spontaneously mentioned.

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Country specific salary informationThis section provides a breakdown of country specific salary information by key indicators (where the sample base is large enough to provide reliable information). All salary information was collected in February and is presented in local currrency.

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Technical informationData collection for the CIMA Global Student Salary Survey 2009 was carried out by CIMA itself online during the period 28 January to 22 February 2009. The data was subsequently rim weighted (by Redshift Research) by CIMA student level to ensure the profile of the survey sample accurately represents all CIMA students working in industry.13,061 CIMA students globally were selected and invited to participate (UK, Ireland, South Africa, Sri Lanka, Malaysia, India, Hong Kong and Australia) – a total of 2,093 completed the study globally (16% response rate), with 1,235 respondents from the UK. Basic responses were as follows:

In order to encourage participation salary data was collected in bands, the lowest point being taken to be £22,500 for the sake of calculations.

Further Information

For further information on technical matters relating to this survey, contact [email protected]

Both the Chartered Institute of Management Accountants and Redshift Research are Market Research Society Company Partners. The organisations abide by the Market Research Society’s Code of Conduct and the Data Protection Act.

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