Management consultancy industry faces turmoil as two-tier remuneration path emerges A two-tier remuneration path has emerged in the management consultancy sector this last year, with a major divide emerging between the most successful consultants and their less fortunate colleagues. This is the major revelation of Top-Consultant.com’s global salary survey. A secondary finding, which confirms the suspicions of many in the sector, is that it was junior staff that bore the brunt of last year’s downturn in consulting revenues - with pay rises and bonuses for juniors at an all-time low.
The survey, which has polled over 3,800 management consultants to date, gives a comprehensive view of the industry - from the major brands such as McKinsey & Accenture, right through to the niche firms.
Analysts & Associates bear the brunt
Both locally and globally, analysts received the lowest pay rises and the smallest % bonuses - reflecting the oversupply of university graduates looking to enter the consulting market... and the backlog of graduates waiting to take up their deferred entry-level positions. Associates fared only slightly better, as the glut of MBA students ready to enter the market also put a lid on earnings growth. Overall this last year, the lion’s share of bonuses went to the more senior ranks.
A two-tier remuneration path emerges
Without question, the headline finding is the emergence of a considerable divide between the highest performers and the rest of their consulting peers. In effect, a two-tier remuneration path has emerged, with the highest performers continuing to enjoy gains only modestly below those of the boom years, whilst the rest of the consulting workforce have seen little improvement in their take-home pay this last year.
Taken as a whole, around 50% of our global respondents received no pay rise in the last 12 months. A similar picture emerges for bonus awards. The average pay rise of 4% thus hides a large segment of consultants who have seen no rise this year.
As a result, consultancies are likely to face pent up pressure for pay rises over the next 12 months - as the consulting market sees stronger growth and resource shortages become more of a concern. Pent-up frustration at these pay freezes is bound to translate into a bidding war for consulting staff as the market heats up again. The survey results are available to all participants on an ongoing basis. If you have yet to take part go to:
http://www.top-consultant.com/uk/salarysurvey.aspx
US and Switzerland has highest paid consultants
The third finding, focussing on the geographical split of the results, is that the world’s most highly paid consultants reside in the United States and Switzerland. In the US, continued pay rises - despite the high base - suggest that the major headcount reductions of the last 18 months have done little to temper consulting salaries for those that remain in the profession.
Management consultancy industry faces turmoil as two-tier remuneration path emerges
Top-Consultant.com’s global salary survey.