Where in the world do managers have the most money? Emerging markets are the place to go for top starting salaries and low costs of living, says Hay Group's Global Pay Report 2008.
Talent management is becoming a truly global market, with emerging economies such as China and the Middle East boosting overall salaries among top managers. Hay Group's management spending survey this year finds an overall growth in management spending power (which measures managers' salaries in 51 countries, taking into account local costs of living and taxes).
Talented managers are flocking to the Middle East, Asia and Eastern Europe, lured by high paying jobs in exotic locations where the cost of living is relatively low. Meanwhile, western economies such as the UK (47 out of 51) and the US (41) risk losing their top talent to overseas posts.
Qatar-based managers enjoy a disposable income that's nearly 2.5 times that of US peers. And Middle Eastern markets overall offer managers huge earning potential, as they've remained relatively unscathed by oil price hikes or the credit crisis. Says Vijay Gandi of Hay Group Middle East: "Senior managers continue to get a salary increase of between 15 to 20 per cent, which is very aggressive compared to most other countries."
Likewise, the booming Chinese economy means companies will pay over the odds to get and keep talent, according to Hay Group Asia's Charlotte Park. Hong Kong's senior managers have almost double their US colleagues' spend, but managers in Thailand and mainland China are also high in the rankings. The other so-called Asian 'Tiger', India's managers still have a relatively low disposable income - Hay ranks it 38 out of 51 -- but average salary are rising by 14 per cent.
The danger is that UK and US companies could lose out unless they develop succession plans, consistent and centralised reward systems and planned career assignments overseas, says Hay. Companies with outposts worldwide should also invest developing a stream of local managers.
Britain's high cost of living, combined with predictions of at least another year of budgetary constraints, will make it particularly tough for UK companies to hold on to adventurous managers in search of international experience.
Peter Christie of Hay Group UK says: [The] best performing companies will carefully target pay increases to key roles and high-performing individuals, and we also expect to see a greater focus on bonuses and other short-term incentives."
But will it stave off a management brain drain?
Where management earns the most:
- Saudi Arabia
- Hong Kong