Press release by Randstad
- Since 2002, the accounting profession’s aggregate salary bill has risen by 11.5% in real terms, as the average salary bill for private sector professions plunges 37%
- Full-time accountants have seen their numbers swell by 40% since 2002, while other sectors such as construction and sales professions have experienced sharp falls
The accountancy profession is one of the most recession-proof private sector professions in the UK, according to an analysis of ONS and professional industry data carried out by accountancy recruitment agency, Randstad Financial & Professional.
The analysis ranks each occupation by the change in the aggregate salary bill for full-time staff between 2002 and 2014, adjusting for the effects of inflation. This takes account of both the resilience of employment levels and real salaries to provide a rounded view of how recession-proof each occupation is.
Randstad’s analysis shows that, over the past 12 years, the total salary bill across the full-time accounting profession has increased by 11.5% – growing from £12.7 billion in 2002 to £14.1 billion by 2014 in real-terms. Meanwhile, other professions with typically high numbers of private sector employees have seen their aggregate salary bills shrink during the same period.
The management consulting profession, for example, has seen its total pay bill fall, in real terms, from £6.9 billion to £5.7 billion between 2002 and 2014 – a decrease of 17.3%. The average aggregate overall salary of those in the travel agency industry, for example, has collapsed, dropping by more than half (55.6%), falling in real-terms from £946 million in 2002 to just £420 million in 2014. On average, the aggregate salary bill for those sectors typically associated with a higher number of private sector employees fell by well over a third (36.8%).
The tech sector was the exception to this rule – alongside the accounting profession – with the industry’s total salaries bill climbing from £17.3 billion in 2002 to £31.5 billion in 2014, representing growth of 81.7%.
Tara Ricks, managing director of Randstad Financial & Professional said: "Accountancy is recession resilient. The profession’s comparatively high aggregate salary bill demonstrates accountants are in the enviable position of being in demand whatever the financial weather. During sunny economic periods, they can pick up consulting work. In more choppy fiscal waters accountants become an invaluable source of risk advice – while the demand for tax advice and audit work is never going to dry up. By contrast, other private sector professionals, such as retail workers and builders, are more vulnerable to the economic climate."
ACCOUNTING PROFESSION SEES STRONG PEOPLE GROWTH
Randstad Financial & Professional’s research also highlights the growth in the number of people employed in the profession; between 2002 and 2015, the number of people registered as accountants in the UK and Ireland grew from 245,712 to 343,753 representing a rise of 40%.
Tara Ricks continues: "It’s no wonder that there’s a talent war. With the profession’s headcount having grown 40% since 2002, it has become harder to find the right people for the right job. Fortunately, given the pay, the opportunity to earn world-renowned qualifications, and the recession proof nature of the job, the profession remains a hugely attractive career to graduates. But, in the short-term, that won’t fill gaps at a more senior level."
National aggregate picture
Although the total number of people in full-time work in the UK rose by 1.4 million, the country’s aggregate pay bill for full-time staff fell in real terms by 3% from £653.8bn in 2002 to £634.1bn in 2014. Across the UK economy, real-terms salaries declined by 8%, falling from £36,200 to £33,500 between 2002 and 2014, as salary rises in the 2002-6 period were reversed.
Public versus private sector performance
Randstad research also showed that, despite austerity measures, occupations with a large proportion of staff employed by the public sector have proven more recession-proof than those dominated by private sector employers. The total full-time salary bill for social workers rose 25% from £1.9bn to £2.4bn between 2002 and 2014. Nursing saw a similar 23% increase in the aggregate salary bill from £10.3bn to £12.7bn over the same period. Of all the private sector-dominated professions, only full-time accountants and technology professionals saw increases in their aggregate salary bill which could rival those of their state sector counterparts.
However, since 2011, austerity has started to impact the real-terms salaries of many public sector professions. The majority of the real salary cuts since 2002 experienced by teaching professionals and social workers have come since 2011 (see Table 4). Nurses, for example, saw the 3.2% real-terms salary increase they enjoyed over the 2007-10 period wiped out by a subsequent salary cut of 6.9% between 2011-14. Similarly, teachers, who benefitted from a 2.3% salary rise during 2002-6, were clobbered with a 6.9% real-terms pay cut over the 2011-2014 period.
However, the economic downturn has hit many private sector-heavy professions far harder. The construction industry was one of the worst hit during the 2007-10 downturn, with the industry shedding large numbers of workers while real salaries fell by 10.3% between 2007 and 2010 and then by a further 12.8% between 2011 and 2014. Similarly, retail workers saw their salaries dip over the 2007-2010, before falling another 5% between 2011 and 2014 as the effects of the recession on consumer confidence began to bite heavily. Within such a context, the 3.7% contraction in real-terms salaries which UK accountants experienced during the 2011-14 period represented the smallest decrease in salaries of any private sector profession.
Notes:  Based on an analysis of the ONS Annual Survey of Hours and Employment and the Labour Force Survey from 2002 to 2014, with supplementary data from The Financial Reporting Council. Mean average wages have been adjusted for changes in the Retail Prices Index with all figures stated in 2014 values.