Executive pay slump: “Salaries have been frozen for four years for the sixth form education sector – and morale is falling”
Senior managers at one sixth-form college respond to new CMI and XpertHR data showing that pay rises have fallen behind the cost of living
Salaries for managers within the further education sector have not increased for four years, and the stagnation is leading to more frequent resignations among talented staff. That’s the admission from the senior leadership team of one regional further education college, in the wake of new figures from the Chartered Management Institute and XpertHR that shows managers’ pay is down against the cost of living.
On 12 June 2018, the Managers and Professionals Salary Survey revealed that the pay of senior managers has fallen by 0.6% in real terms, when compared against the Consumer Price Index. Bonuses for managers are down 16% in the same period.
It’s a picture that Petra Wilton – director of strategy at the Chartered Management Institute – said could lead to Britain “sleepwalking into a productivity crisis”. She explained: “Too many managers are chronically overworked and stressed by an always-on culture,” and called for businesses to find new ways to attract staff in order for Britain to recruit the estimated two million more managers that it needs to meet the demands of a post-Brexit economy.
The managers at the sixth-form college we spoke to said that pay declines could be even worse within the education sector. “Increasing cost pressures including VAT, a squeeze on funding and higher rates of National Insurance have meant that we haven’t been able to award a cost of living raise in four years,” explained finance director, Jack Stevens*.
With income for this regional college having fallen from £34m to £22m in the same period, he described the pay freeze as “a fairer thing to do” in the wake of restructuring programmes which have seen staff redundancies. However, he described managers within the college as “generally unhappy with the level of pay”.
“Up until now, the staff have been broadly understanding, but we are now starting to see industrial action from union members,” he added. This included strikes over the GCSE exam period.
While many of the managers at the college insisted that pay wasn’t their primary working motivation, Principal Jo Kloet* acknowledged that low-level – or in this case, a complete lack of pay increases for managers – was a serious issue. “We recognise that [pay influences] people’s lives and it’s not something that’s taken lightly.” She believes that the declining figures for senior managers reflect salary trends for all staff. “If senior managers were getting a pay rise and others weren’t, it would cause a difficult situation – you have to have one rule for all.”
CMI’s Wilton has welcomed the government’s plans to make organisations publish the ratio between the pay of senior executives and lower-level employees. “The government’s timely reporting plans reflect the changing mood in business. CMI research reveals that 74% of all managers and two-thirds of directors or partners support curbing disproportionate executive pay.”
However, with no changes able to be made to salaries at the college, the leadership team has attempted to introduce other incentives for successful performance and manage workloads. “We have tried to find other ways to show appreciation,” said one. “First, we offer a professional development programme so that they can try and progress to the next rung of the ladder. We’re also conscious of work life balance so training days include skills such as meditation to help with stress. Yet with funding frozen, it is not always possible to find tangible things to be done.”
*Names have been changed
For more information on the Managers and Professionals Salary Survey visit managers.org.uk/salarysurvey