The rise and fall of Salary Man
Goodbye, chauffeur-driven company cars; hello, share options and female bosses
“I didn’t get where I am today by being a good chap,” declared Sunshine Desserts’ managing director, CJ, in one episode of 1970s sitcom The Fall and Rise of Reginald Perrin. He may not have been unique in the beige boardrooms and tobacco-stained offices of the era.
If you think women get a poor deal in management today, look back 40 years or so.
Back in 1974, the British Institute of Management (now CMI) got together with a small consultancy called Remuneration Economics Ltd (the forerunner of today’s XpertHR) to launch the National Management Salary Survey, which would provide reliable information on salaries and fringe benefits.
Salaries could not have been higher on the national agenda. With inflation in double figures, some 250,000 coal miners went on strike in pursuit of their claim for a 35% pay rise, prompting the introduction of a fuel-conserving three-day week and the fall of Ted Heath’s Conservative government.
In the months that followed, the miners won the rise they had demanded in full, while nurses got an average 30% increase and the TUC agreed a “social contract” on voluntary wage restraint.
But unionised workers were not the only ones getting in on the act. A report from the National Board for Prices and Incomes, set up in the mid-1960s in a futile bid to combat inflation, reported that executive salaries in the private sector had increased by 76% in the five years leading up to the end of 1973.
No wonder employers felt they needed reliable pay benchmarks.
That first salary survey report was quite an achievement. From a standing start, it reported on the remuneration of 21,749 managers. The highest salary in the survey was £65,000 – shocking for the time – with 31 others coming in at £30,000 or more.
Across the survey, the median salary for a CEO was reported as £13,398, though in the public sector, which then included a large swathe of industry, no-one earned over £11,410.
These were not insignificant sums. Even after their 35% pay rise, miners working underground for 40 hours a week still got just £1,872, while a staff nurse in the NHS earned £2,202.
It was a whole different world. In 1974, two out of three managers had been with their present company for more than a decade, while one in three had put in 20 years or more.
Nearly nine out of 10 directors got a company car, while one in seven had prime use of a chauffeur-driven vehicle. But just one in five CEOs had a share option scheme, while four weeks’ holiday was still the norm at even the highest levels.
I have been engrossed in these reports for a reason. After more than 40 years, the National Management Salary Survey is being relaunched this year as the Managers and Professionals Salary Survey.
This small change in name encompasses a considerable rethink of how we collect, analyse and publish data.
The first report back in 1974 made the proud boast that just three months had elapsed from the close of data collection to publication. At the time, that meant converting hundreds of handwritten data submissions to punchcards, renting time on a mainframe computer to crunch the numbers, and then typing out hundreds of salary tables for the report.
Today, less than a fortnight passes from close to publication. And, while in 1974 we reported on pay rates for about 20,000 managers, in 2017 the number stood at 119,707, with women making up 54% of the sample.
That brings me to the single most shocking statistic from the early days: of the 20,000 managers or so whose pay was captured by that first report, all but 338 were men. Good chaps indeed.
Mark Crail is content director at XpertHR. Tweet him: @Payintelligence