Tag Archive | "ons"

Why are female accountants paid less than their male counterparts?

More than 50% of female accountants believe they are held back because of their gender and this affects their chances of promotion and their salary. Only 12% of men think they are disadvantaged in the same way, according to a recent study by Marks Sattin.

The annual hours and earnings survey from the ONS showed that the average salary for a female accountant was £32,080 last year. However, the average male accountant received at least £6,000 more giving him a salary of £38,500.

Overall average salaries have dropped in the accountancy sector over the last couple of years. In 2010, females received £32,120 and their male counterparts got £41,700.

Men still continue to dominate in the boardroom as well. Women make up less than 14% of the board members in the Big Four firms both at home and in Europe.

Lord Davies recommended that at least one in four board members in FTSE 350 companies should be female by 2015, but it looks like accountancy firms may struggle to achieve that. According to the CBI, just 14.5% of FTSE 100 board positions are held by women at the moment.

Marks Sattin MD, Dave Way, explained that although the accountancy sector recruits an equal number of male and female graduates, very few females rise to the top.

Females feel disenfranchised from the highest positions and they need to actively promote themselves for senior roles and not let historical precedent determine the make up of future boardrooms.

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Should contractor accountants take less VAT?

Accountants may be interested to read the latest Office of National Statistics research concerning UK householders VAT expenditure.

The data shows that the UK’s poorest households now pay more VAT in proportion to their total income than they did twenty-five years ago, whilst in the richest households, the proportion remains the same.

In 1986, VATable items accounted for 45% of the poorest 20% of households’ weekly expenditure. By 2001/02 they were spending 58% on items that attracted VAT. That percentage has dropped slightly, but in 2009/10 they were still spending 55% of VATable items.

Over the same period, the percentage of income the richest 20% of households spent on VATable items remained virtually unchanged. The ONS research does not take into consideration the period since the VAT rate increased to 20%.

Still on the subject of VAT, employers need to be aware that changes to the VAT regulations concerning salary sacrifice come into force from the 1st of January next year.

In the past, salary sacrifice schemes have proved popular in part because they brought with them tax advantages, such as reduced PAYE and NIC liabilities and a VAT advantage.

However, as from the start of 2012, employers who recover VAT on benefits and then pass them on to employees under a salary sacrifice arrangement will have to pay VAT on the amount sacrificed.

HMRC says that schemes such as the Cycle to Work scheme will fall under this new arrangement, as will food and catering provided by an employer. Childcare, pensions and private health insurance salary sacrifices will remain unaffected by the new regime.

© 2011 All rights reserved. Reproduction in whole or in part without permission is prohibited.

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Employment statistics contain a glimmer of hope

The latest employment statistics released by the ONS last week should bring a crumb of comfort to Britain’s younger generation.

895,000 young people were registered as unemployed between February and April this year, the lowest number since April 2009. Unemployment across all age groups also dropped to 2.43 million.

Kevin Green, the chief executive of the REC, said the reduction will be welcomed but warned that this could be the calm before the storm. Ten of thousands of young people will be leaving full-time education in the next few months and a large proportion of them will not have a job waiting for them.

The picture looks mixed for those in the 50-64 age bracket. 36,000 more people in this age group joined the working populous but the number claiming Jobseeker’s Allowance also increased and this group also has the highest proportion of people who are long-term unemployed; i.e. without a job for more than 12 months.

Meanwhile, prospects are improving in the City. The MD of Marks Sattin, Dave Way, said there has been a visible boost in middle tier employment amongst the 35 – 49 age group in City firms and finance and accountancy workers are confident they will receive a salary increase in excess of 8% this year.

The director for employment at the CBI, Neil Carberry, said the private sector seems to be creating jobs and he hopes this trend will continue. However, long-term unemployment is still a serious problem and the government must tackle the structural causes of this in order to get the UK working.

© 2011 All rights reserved. Reproduction in whole or in part without permission is prohibited.

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Would contractor accountants recommend their employer others?

A fair proportion of UK workers are not happy, according to the latest research from Badenoch & Clark.

The recruitment consultancy discovered that 22.8% of employees are unhappy in their job and 27% would not recommend their employer to others. A further 21.9% go to work simply out of routine, whilst the motivation to go to work for 10.3% is spiralling debt.

Unhappiness is highest amongst lawyers and finance professionals, such as contractor accountants. 27% of lawyers said they would be highly unlikely to recommend their firm to others looking for a position.

Badenoch & Clark has been tracking happiness since 2007. This time last year its research showed that 78% of employees in the UK reported high levels of happiness.

The survey results come at the same time as the news that David Cameron wishes to create a ‘happiness index’ measuring the wellbeing of UK employees. The aim being to prove that money isn’t everything and shift the focus away from GBP and onto GWB (General Well Being).

Meanwhile, small business owners are being urged to communicate with their employees and offer them reassurance as pay freezes continue.

Figures recently published by the ONS showed that growth in average annual earnings remained at 2.1% in November. This led to Diana Bruce, from the Chartered Institute of Payroll Professionals, saying it was imperative for employers to tell their employees why a pay freeze still exists. This becomes even more important as the VAT increase has already affected personal spending and National Insurance contributions will increase in April. Employees who are motivated to work solely for the money will become increasingly disillusioned if salary freeze explanations are not forthcoming.

© 2010 All rights reserved. Reproduction in whole or in part without permission is prohibited.

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Business failures mean less demand for accountants for contractors

More businesses closed than started up in 2009, according to recently released statistics from the ONS.

Last year about 279,000 businesses closed their doors, the highest number since 2000 when the business demographic survey started.

As far as business births were concerned, the highest rate was in business administration and support services at 13.9%. 48,000 new businesses were created in professional, scientific and technical, representing a birth rate of 12.5%.

Over 44,000 construction companies died in 2009, whilst 42,000 professional, scientific and technical faded into oblivion. Business administration and support services had the highest death rate of all at 14.8%.

London had the highest birth and death rate, recording 12.6% of all new start-ups and 13.7% of business closures. Northern Ireland, on the other hand, recorded the lowest rate in both categories with 6.6% of new businesses and 9.2% of business deaths.

The CBI has now predicted that business growth next year will be slower than it had first thought. The employers group now predicts growth of only 0.2% in quarter one next year with a total growth for 2011 of 2.0%.

The first few months next year are expected to be especially sluggish due to the VAT rate hike, according to the CBI.

Ian McCafferty, the chief economic adviser to the CBI, said that economic growth had surpassed expectations in 2010 but this is not expected to continue as government austerity measures and VAT rises enter the economic equation.

The CBI has also predicted that economic growth will increase by 2.4% in 2012.

© 2010 All rights reserved. Reproduction in whole or in part without permission is prohibited.

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What does 2011 have in store?

Contractors could be amongst those set to benefit from internal skills shortages at UK firms as we go into 2011.

The Chartered Management Institute recently said that 43% of managers in the UK think they cannot fulfil their objectives for next year with the staff they currently have. As a direct result, 48% are expecting to make further redundancies in 2011. This could lead to openings for highly-skilled limited company contractors as companies look to complete tasks without increasing the size of their permanent workforce.

The CMI’s chief executive, Ruth Spellman, said that 2010 has been a very difficult year for managers and in many cases they have had to deal with the difficult conditions without a suitable team.

There are also conflicting reports on the state of the UK economy and its jobs market. The latest figures from the ONS show that unemployment reached 29.13 million in the quarter to October. 33,000 of the 35,000 job losses were in the public sector which is to be expected considering the government’s austerity measures.

The CIPD says the figures bring no joy to jobseekers and its chief economic advisor, Dr John Philpott, said the data was far worse than expected. He believes the jobs market has run out of steam which does not bode well for prospects in 2011.

The British Chamber of Commerce, on the other hand, said that whilst the figures were disappointing, they gave no cause for despondency and longer-term trends point to a strong labour market.

The REC was also disappointed by the latest figures. Kevin Green said that employers are still cautious about hiring new employees but he still believes growth will return to the jobs market in the New Year. However, contractors, temporary staff and interim workers are likely to play an important role in helping businesses meet increased customer demand.

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Could public sector cuts benefit small businesses?

It’s not all doom and gloom in the business sector. In fact some firms believe that they will profit from the government austerity measures.

Admittedly many businesses are going to lose public sector contracts, but the job losses could well create outsourcing opportunities. Last week, the government announced that £236bn of public sector contracts would be made more accessible to SMEs. In a bid to ensure that 25% of public sector contracts do in fact go to smaller businesses and limited company contractors, all government departments will be required to publish details of all the contracts they award, and how many go to small firms.

The coalition is also looking into a more open framework to tackle the closed procurement system which generally means contracts are awarded to preferred bidders which are usually bigger organisations.

Other good news came recently when figures were released showing the economy grew at twice the expected rate in quarter 3. Experts say a double-dip recession is less likely as data from the ONS showed the economy is growing at the fastest rate for 10 years.

However, these figures do not take into account the public spending review and the impact it will have on the country.

Nevertheless, the better than expected picture could encourage investors to start thinking about expanding their portfolios. The stock market can seem to be contradictory in times of economic crisis. In 2009, the UK was in recession and yet the stock market rose by around 30%.

Before contractor accountants rush out and pile all their money into stocks and shares, they may want to consider talking to a specialist financial advisor.

© 2010 All rights reserved. Reproduction in whole or in part without permission is prohibited.

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Fears of double dip recession eased

Fears of a double-dip recession have been alleviated, at least temporarily, by a report released at the end of last week that showed that GDP rose 0.2% in the first quarter of 2010.

Self employed contractors and limited companies in the financial sector should definitely be encouraged by this news as the rise was mainly due to a growth in financial industries and business services of 0.6%.

Other sectors that contributed to the growth were communication, government, storage and transport.

Some industries however did not show such positive results, with construction, distribution, hotels and restaurants all showing a decrease in output

The treasury spokesman for the Lib Dems, Vince Cable, was not particularly optimistic at the news. He said that there is still a real danger of the country sinking back into recession as the marginal growth shows there are very few visible signs of the promised recovery.

He added that whilst the banks continue to starve businesses of credit and people struggle to get out of debt, the recovery is likely to remain in a fragile state.

© 2010 All rights reserved. Reproduction in whole or in part without permission is prohibited.

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