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News Release from: Chartered Management Institute
Edited by the Manufacturingtalk Editorial
Team on 29 July 2004
Manufacturing manager resignation rates
are steady
Manufacturing managers are remaining loyal to their employer as their salaries rise - one of the findings of the Chartered Management Institute Remuneration Economics annual salary survey.
Resignations amongst manufacturing managers have remained steady in the year to January 2004 as movements in earnings grow, according to research by the Chartered Management Institute and Remuneration Economics The results, from a survey of 21,987 managers, also show major changes to lifestyles and employee reward schemes since the survey began thirty years ago
This article was originally published on Manufacturingtalk on 2 May 2006 at 8.00am (UK)
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However, combined earnings for manufacturing managers rose by 6.7 per cent, from GBP 35,923 to GBP 38,310.
Managers in the chemical industry currently top the 'earnings league table' on GBP 55,359 with those in retail earning the least (GBP 35,748).
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Although the average income for managers is now GBP 42,050 compared with GBP 4,067 in 1974, this rate of increase has not kept pace with spending on essentials such as housing, or consumables such as beer.
Thirty years ago the average UK house cost GBP 9,900 against GBP 162,000 today and a pint of beer could be bought for less than 7 per cent of today's average price (GBP 0.17 against GBP 2.50).
The findings reveal some stark changes in the way employers provide benefit packages for their staff over the last 30 years.
Back in 1974, 87 per cent of directors had sole use of company cars, compared to 65 per cent today.
At managerial level these figures have fallen from 72 to 44 per cent.
Ford is still the favoured manufacturer but the Cortina has been replaced by the Focus Zetec as the UK's most popular car.* In an effort to secure employee loyalty, benefits increasingly feature in the overall remuneration package.
In June 1974 private medical insurance (47 per cent) and share option schemes (22 per cent) were not widespread.
However, the number of organisations now providing similar incentives has dramatically increased to 70 per cent (medical insurance) and 50 per cent (share options), with other commonly offered benefits being company pensions schemes (96.7 per cent) and mobile phones (79.5 per cent).
Thirty years ago parental help was almost non-existent, but 1 in 5 employers now offers some form of provision for childcare.
However, 4 out of 10 still have no form of flexible working to offer.
And with the overall improvement in benefit offerings, the number of manufacturing executives handing in their notice has remained steady.
Only 1.5 per cent of manufacturing directors and managers resigned their posts, compared to 1.7 per cent in the year to January 2003.
Resignations are highest amongst professionals in business service functions (8.6 per cent) and human resources (6.2 per cent), but lowest in the manufacturing sector.
Regionally, the most loyal executives are in the West Midlands, where only 2 per cent resigned in the last year.
Petra Cook, head of policy at the Chartered Management Institute, says: "It is encouraging to see a slight decrease in resignations because, unchecked, they will impact upon the future strategic development of UK organisations.
There is also a growing need to develop benefits packages to suit a range of lifestyles as employees are clearly focusing on the value of their remuneration package as a whole before deciding whether to change jobs." Surprisingly the survey found that senior managers are increasingly likely to move jobs despite the belief that 'seniority equals stability.' Over one-tenth of chief executives (12.9 per cent) changed employer in the last year, an increase from 4.8 per cent in 2002 and a dramatic change from thirty years ago, when 36 per cent of senior management had been with the same company for 20 years or more.
Organisational loyalty has clearly declined across all levels though, with 58 per cent of businesses citing competition from other organisations as a reason for losing staff.
Commenting on the findings of this year's report, Paul Campfield, director of Remuneration Economics says: "In 30 years of reporting, this research has created a valuable picture of management progress.
It is encouraging to see that organisations are increasingly offering more flexible working patterns as one of the practices to retain key managers." Only 23 per cent of organisations questioned demonstrated a willingness to provide flexible benefits as part of the remuneration package.
However, of those who do so, 82.5 per cent offer cash as an alternative to standard benefits such as pension contributions, life assurance and annual leave.
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