London firms fear losing top talent over coronavirus salary cuts
The vast majority of London firms are concerned about retaining their top talent as the pandemic forces many employees to take salary cuts.
As the pandemic continues to weigh on business activity, over four in five London-based businesses are concerned about losing their top employees, according to new research by recruiter Robert Half.
Of the 1,500 executives surveyed, 42 per cent cited salary reductions and the inability to increase wages as the key reason, higher than the national average of 36 per cent.
Despite ongoing pandemic-related uncertainty, the majority of companies have continued to compensate employees at pre-pandemic levels thus far in a bid to retain the top talent.
Robert Half’s managing director Matt Weston said: “Professionals with in-demand skills know they still have options, and employers need to offer competitive salaries and benefits to retain key personnel, as well as to attract and secure top candidates for the remainder of 2020 – and beyond.”
But the recruiter’s research shows over two thirds of firms are still offering salaries that meet or exceed the levels seen before the coronavirus outbreak.
And almost half of all senior managers said salaries had held steady, while 23 per cent noted an increase in base compensation.
However a joint KPMG and RECS survey, also published today, indicates that this trend is unlikely to continue as rising candidate numbers, paired with subdued demand for workers and greater pressure on budgets have contribute to a reduction in pay.
The survey shows that while there was a slight improvement in recruitment activity last month, redundancies have driven a further rapid rise in candidate numbers.
This will only be exacerbated by the looming end to the government’s job retention scheme at the end of this month.
Despite the doom and gloom, KPMG’s survey reveals that September saw the first increase in overall vacancies since February, albeit marginally. This was driven by an increase in temporary vacancies across the private sector, while permanent roles continued to decline.
James Stewart, vice chair at KPMG said: “With increasing unease over what will happen in the coming months with the pandemic, Brexit and with the end of the furlough scheme in sight, the uncertainty for UK business is not going to dissipate anytime soon.”