In 2017, salaries for accounting and finance professionals rose on average by 1.4%, the same rate as in 2016, but salary growth in this industry continues to fall below the average salary increase for all industries which is 1.8%.

Hays salary research, which surveyed 1,300 employees and 1,089 employers in accountancy, found that 77% of employers plan to increase salaries further in 2018 with 79% having done so in 2017.

Karen Young, Director of Hays Accountancy & Finance, said: 'There is a slight air of caution from accountancy and finance employers in light of political and economic uncertainty, and a result salaries within accountancy and finance remain fairly steady in the most parts, and albeit lower than some professions across the UK. There are however signs of salary increases within skill-short areas which includes part and newly qualified accountants, payrollers, and audit & risk professionals.'

Salary pressures look to continue as employers battle with skill shortages and employees remain unsatisfied with their current salaries.

Over a third of employers expect to encounter applicants with unrealistic salary expectations and only 46% of accountants are currently satisfied with their salary.

Financial accountants saw the highest pay rise at 3.3%, with the average salary being £43,542. This is followed by finance managers and systems accountants whose salaries increased by 3.2% in 2017 to an average of £50,542 and £51,125 respectively.

Newly qualified accountants saw a pay increase of 2.9% with an average salary of £40,375.

On average ACA trainee accountants in London are paid more at £27,000 than ACCA (£25,000), CIMA (£25,000) and CIPFA (£23,000). Part qualified accountant’s salaries have increased by 1.6% to reach £26,295.

Young said: 'Higher salary increases are due to changes within the marketplace such as legislation, or supply linked to particular areas which are more skill-short than others. For example, ongoing legislation and regulatory changes such as IR35, gender pay gap reporting and pension automatic enrolment means that payroll professionals are still highly sought after, and as a result this skills area has seen the highest pay inflation within the accountancy and finance sector over the last 12 months.

'There is also an increasing need for experienced audit, risk and compliance professionals as organisations look to mitigate the risks to reputational damage carried by the proliferation of social media, as well as the potential risk of corporate fines.'

Top salary increases

Skills shortages

Nearly two thirds (60%) of employers said that competition for roles and opportunities is the main cause of skill shortages followed by fewer people applying for accounting and finance roles.

Young said: ‘There are signs of employers addressing skills shortages from a grassroots level as over a quarter (26%) said they had recruited apprentices this year, 19% said they had increased their training budget, and 18% said they had implemented a mentoring programme to address the issue.

‘In such a skills short environment, organisations need to consider how they can better attract talent in order to remain competitive. They will need to look at other ways aside from salaries to attract the skills needed, increasing opportunities for career and personal development which employees tell us they are looking for in new roles.

‘Additionally, employers can look to review their benefits offerings, as our results indicated a mismatch between what employees are looking for and what employers are providing.’

Retention

Over the next year, 52% of accountants expect to change jobs with a lack of future opportunities (27%) being the main reason, aside from salary and benefits.

Over a quarter admit that work-life balance is the most important factor when considering a new role, when not taking into account salary, despite 60% believing their work-life balance is positive.

The most attractive benefits are flexible working (67%), over 25 days annual leave (65%), above statutory contributory pension (50%) and health insurance or private medical cover (42%).

Report by Amy Austin