Sunday, 23 October 2011

Wealthy Russian top managers leave Europeans trailing

The image of the wealthy expat manager is wearing thin as their Russian counterparts’ salaries are almost two-thirds more on average, according to a recent study.

Russian high-fliers earn salaries that are 60 per cent more than their Western European counterparts and their yearly bonuses 40 percent more, says a survey from global management consulting firm the Hay Group, Vedomosti reported.

The discrepancy is huge and reasons varied but the figures bear some closer examination.

Top-rollers have more disposable income in Russia for a start and there are not the same caps on bonuses as in some European countries.

“Most of the time we find that the salaries that Russians and expats receive are actually pretty similar…Compared with Europe, the Russian flat rate of tax is lower, at 13 percent, in Sweden it is 72 percent. In Russia you can earn a hell of a lot more by being average,” Luc Jones, partner at recruitment specialists Antal Russia, told The Moscow News.

And bonuses seriously affect the picture, Russians take first place in Europe for bonuses, Irina Chernozubova, head of the Hay Group’s Russia office, told Vedomosti, and almost without exception the Russian offices that took part in survey paid their managers yearly bonuses.

In crisis-struck Europe only 60 percent of executives managed to earn their bonuses.

“There are few good international style managers [in Russia], the ones there are can command a very high price. Plus, the Russian economy is not doing that badly and it has created a bit of a bubble of late, which puts an upward pressure on salaries,” Jones said.

He added that top-notch Russians expect a pay rise of 25-30 percent when they change jobs, whereas Europeans will often settle for a similar sum to before.

And this happens with more regularity than company account departments would like, as top-level Russian employers have not yet developed ways and means of holding onto people for a long time, Sergei Lvov, general director of Axes Management.

Russian shareholders are prepared to fork out for mangers who can navigate the vicissitudes of both the international and the Russian markets.

This could be because Russians have a more difficult task ahead of them and their jobs throw up a much greater number of unexpected or ill-defined tasks, Olga Shcherbakova, a partner at recruitment specialists Ward Howell, told Vedomosti.

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