City bonuses soar

Bonuses in the City of London have grown to 30% of salary, equivalent to six times the national average

Across the financial services sector, bonus pay-outs are likely to rise 12.3% year on year, according to a report by Joslin Rowe, a financial services recruiter. Across the UK, bonuses are expected to rise by 5.8% which means the city bonus climb is more than double the rate of growth for bonuses in the wider economy.

The report predicts those working in high-paying city jobs will earn a bonus on average equivalent to 79.5% of their salary, while the top 3.2% of financial services workers may see 100% bonuses.

Tara Ricks, managing director of Joslin Rowe, said: "It’s the big hitters who expect more than 50% of their salary in bonuses [such as] the private bankers, the corporate financiers. A lucky minority will earn several multiples of their basic salary. The booming stock market and blistering levels of mergers and acquisitions in 2006 have obviously played their part in inflating the numbers paid out in 2007.

"Bonuses are an increasingly important management tool. Although employees now expect them as part of their annual compensation and top performers are being increasingly tempted to move company with large guaranteed bonus packages, employers are increasingly sophisticated in allocating the bonus pool to reward their best workers."

Not all people working in the city will receive such high bonuses or impressive pay packages but among the 300,00 city workers (earning an average of £47,116) bonuses are expected to rise to £13,607 or 28.9% of salary.