Commuter crunch strikes as soaring travel costs outstrip pay rises

PAY DATA

'Commuter crunch' strikes as soaring travel costs outstrip pay rises

Many commuters face a miserable journey back to work after the festive holidays, as the latest Hay Group PayNet UK Salary Tracker reveals that hardest-hit workers could spend on average 8% and in some cases up to a third of pre-tax salary on travel costs in 2013.

Average train fare rises of 4.2% will lift a typical annual season ticket to £2,191, or 8% of the median UK salary of £26,082. Meanwhile, those who drive to work will burn on average 5% of pay on petrol, £1,443 annually.

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However, it’s not all bleak news for UK workers. According to global management consultancy Hay Group, towards the end of last year pay increased by 3.5%, outstripping inflation and boosting real pay for the first time since 2009.

The firm's PayNet UK Salary Tracker analyses pay and salary movements across five different employee levels in over 700 organisations, representing over one million employees.

Key findings

• “Operative level” workers - receptionists, accounting clerks, data entry operative roles etc - in Birmingham could, in the worst cases, expect to spend up to one quarter (23%) of their annual salary on rail costs.
• Petrol could guzzle up a third (34%) of pay per year for operatives who drive to work in Wales.
• Operative level workers face an average season ticket price costing 13% of annual salary in 2013 – rising to an extraordinary 18% in London. And, as this figure does not include Underground or bus travel, many commuters in the capital will have to stretch even further to cover the cost of their journey.
• The average for professionals - accountants, engineers and buyers etc - across Britain is lower, with employees paying out 7% of a median salary (£29,723) on train travel.
• However, those at this job level often choose to commute further, to avoid high living and housing costs. This means a season ticket cost of up to 12% of salary for commutes over 50 minutes.
• In other UK cities, including Manchester, Bristol and Leeds, average season ticket fares make up 12-14% of annual salary for operative level workers.
• Meanwhile, Cardiff commuters fare better, with operatives spending a more manageable 8% of salary on rail travel on average.

A final word

“As the cost of commuting continues to rise faster than wages and inflation, employees are becoming increasingly concerned about the significant proportion of their salaries they lose to travel. With real pay finally returning to positive growth and the jobs market beginning to pick up, organisations must take action to ensure that their top talent isn’t seduced by better offers elsewhere. Therefore, employers should benchmark pay and benefits against their peers and ensure they’re paying their employees fairly and competitively.

“But it isn’t all about pay. There are affordable measures that organisations can take to help employees with the mounting 'commuter crunch', including flexible working, the opportunity to work from home or season ticket loans. In addition, employers who are concerned about losing key talent should ensure they measure employee engagement effectively and also consider offering more development opportunities such as training or promotion.” - Adam Burden, consultant at Hay Group.

Want to know more?

Hay Group’s PayNet UK Salary Tracker is a comprehensive quarterly analysis of salary against inflation, as well as other economic indicators. For more information, visit www.haygroup.com/uk/salarytracker.

The PayNet Salary Tracker provides salary movements across five employee levels. All salary figures are before tax.

Hay Group is a “global consulting firm that works with leaders to turn strategies into reality”. With 85 offices in 49 countries, it works with over 7,000 clients across the world. For more information visit www.atrium.haygroup.com.