A new study out this week has shows that although City bonuses have nosedived by around 8% in the last 12 months, workers managed to swerve the windfall after being awarded a 7% rise in basic salaries.
Research from the Centre for Economics and Business Research reveals that although bonuses fell from £7.3 billion to £6.7 billion in the last financial year, basic salaries in the Square Mile jumped by 7% during the same period. And while bonuses fell during the financial year of 2010-2011, they still remain higher than the levels recorded for 2009.
The figures highlight the growing differences in wages between the City and the rest of the UK. While wages soared by 7% for City workers, workers across the UK as a whole only experienced a wage rise of around 2%.
“Ordinary people are paying a heavy price for the economic problems the banks helped cause. Essential services are being cut, workers are seeing a real-term cut in wages as prices rise higher and faster than their salaries and many are at risk of losing their jobs,” commented TUC senior policy office Janet Williamson. “Despite all this hardship it’s very quickly gone back to business as usual in the City.”
The new figures come just a few months after the Project Merlin deal was struck between the government and the top 5 British lenders – Lloyds Banking Group, RBS, HSBC, Santander and Barclays. As part of Project Merlin, the top banks agreed to limit their bonuses, be more transparent about their pay packages and increase their lending in 2011.