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Average Salary By Age In The UK – A Guide for Employers

Average Salary By Age UK

As a business owner hiring employees in the UK, it’s important to have a good understanding of the average salary levels at different ages and career stages. This allows you to set appropriate pay rates to attract and retain staff because salaries often vary significantly based on age and other factors.

What Should Employers Know About Salaries?

When setting pay rates for your employees, there are a few important things to keep in mind:

  • Salary expectations and needs tend to vary by age and life stage. Younger workers may prioritise career development, while older staff want higher pay and flexibility.
  • Experience, qualifications, skills and responsibilities should be key factors in determining salaries, not just the employee’s age.
  • Legal minimum wages must be met, and wages should be fair based on market rates for the role, skills required and location.
  • Salaries should be reviewed annually at a minimum, with clear processes for pay rises and progression.
  • Be aware of age discrimination laws. Salaries should be based on merit, not age.
  • Provide equal pay for equal work. Salaries should not vary by age for those doing the same role.
  • Budget for the rising salary costs as employees progress in their careers and gain experience over time. Staff turnover is expensive.

By benchmarking salaries for each role and setting fair, competitive pay rates, you can attract top talent, drive engagement and retain staff for longer.

Salary Expectations by Age

Employees at different career stages tend to have varying salary expectations and needs based on their age and responsibilities:

16-21 Year Olds

This age group are likely to be starting their first jobs straight from school or while studying. Many will be working part-time or doing retail, hospitality or entry-level roles.

Typical Salary Expectations: £10,000 – £18,000

What They Value: Gaining work experience, training opportunities, flexibility to study

22-30 Year Olds

These employees are new graduates or in the early stages of their careers. They expect rapid salary growth as they build skills and experience.

Typical Salary Expectations: £18,000 – £28,000

What They Value: Career progression, training, developing expertise

31-45 Year Olds

At this life stage, salaries should peak as employees take on more senior and specialised roles. Expect greater demands for pay rises and flexibility.

Typical Salary Expectations: £30,000 – £55,000

What They Value: Work-life balance, benefits, opportunities for promotion

46-60 Year Olds

Employees focus on high earnings and preparing for retirement at this career stage. They bring greater expertise so expect the highest salaries.

Typical Salary Expectations: £40,000 – £85,000

What They Value: Flexibility, financial security, respect for experience

Over 60s

Those still working may move to more flexible, part-time consulting or mentor roles. Salary needs often decline closer to retirement.

Typical Salary Expectations: £20,000 – £60,000

What They Value: Flexible arrangements, work-life balance, respect

Remember these are broad generalisations and you should always focus pay on merit, skills and contributions, not age.

Average UK Salaries By Age Bracket

To set realistic, competitive salaries, you need to know the going market rates. Here are the2023 current median full-time gross salaries in the ONS survey for hours and earnings:

AgeWeekly Wage (median average) Full time gross payAnnual salary*
18-21£401£20,888
22-29£546£28,413
30-39£678£35,256
40-49£727£37,825
50-59£681£35,402
60+£603£31,340

Source for Weekly Wage: ONS Annual Survey for Hours and Earnings (October 2022). Median average weekly gross wage for all full-time workers in the UK

*Annual salary calculated by multiplying weekly median wage by 52

Setting Graduate Starting Salaries

Typical graduate starting salaries by industry:

  • Law – £45,000
  • Investment Banking – £55,000
  • Consulting – £40,000 to £65,000
  • Technology – £25,000 to £40,000
  • Engineering & Manufacturing – £27,000 to £32,000
  • Retail & Hospitality – £19,000 to £25,000

Bulge bracket law, finance and consulting firms pay far higher graduate salaries than other sectors due to their competitive recruitment. Also factor in technical skills, work experience and academics when setting pay. Top students from leading universities expect higher pay.

Salary Benchmarks By Role and Industry

Typical salaries vary greatly between different roles and sectors. Here are some average UK salary benchmarks to guide pay rates:

Legal

  • Paralegal – £20,000 to £35,000
  • Solicitor – £45,000 to £100,000
  • Partner – £100,000 to £200,000+

Healthcare

  • Junior Nurse – £25,000
  • GP – £60,000 to £90,000
  • Senior Consultant – £85,000 to £115,000

Financial Services

  • Actuary – £40,000 to £100,000
  • Accountant – £30,000 to £60,000
  • CFO – £120,000 to £200,000

Tech

  • Junior Developer – £25,000 to £40,000
  • Software Engineer – £40,000 to £70,000
  • CTO – £80,000 to £150,000

Engineering & Manufacturing

  • Apprentice – £15,000 to £20,000
  • Mechanical Engineer – £30,000 to £50,000
  • Operations Manager – £45,000 to £65,000

Research salaries thoroughly for each role using job adverts and surveys. The location also impacts pay rates.

Salary Negotiation By Age

Employees of different ages and experience levels often negotiate salaries differently:

20s

Younger staff lack confidence and benchmarks to negotiate strongly. Sell opportunities for rapid progression.

30s

Employees aim for big salary jumps by leveraging offers. Counter with progression tied to results.

40s

Expect employees to demand higher pay based on experience. Link raises to increased responsibilities.

50s

Veteran staff want pay to reflect deep expertise. Offer flexibility and retirement planning.

60s

Older staff seek flexibility and work-life balance over high pay. Offer consulting or project roles.

Build salary negotiation skills at all levels. Be transparent about pay criteria to set expectations.

Managing Salary Expectations

To manage salary expectations across age groups:

  • Set clear salary bands for each role based on market data, skills and experience.
  • Communicate pay criteria and progression policies transparently.
  • Offer regular salary reviews tied to performance and mastery, not tenure.
  • Provide clear promotion pathways to boost earnings over time.
  • Reward exceptional performance with bonuses and pay rises regardless of age.
  • Support development to boost employability and earnings ability continuously.
  • Be flexible to retain experienced staff e.g. consultancy roles.
  • Focus conversations on career needs not only immediate pay demands.

With fair, competitive salaries and opportunities for growth, you can build an engaged, thriving workforce.

Avoiding Age Discrimination

When making pay decisions, focus on performance, skills and experience – not age. Avoid discriminating by:

  • Never make assumptions about salary needs or expectations based on age.
  • Ensuring equal pay for equal work regardless of age – pay should be based on merit only.
  • Providing identical benefits and salary progression opportunities to all staff.
  • Not deterring older applicants with lower salaries than they expect based on experience.
  • Accommodating the needs of older staff e.g. flexible hours, rather than reducing pay.
  • Judging all employees on their individual productivity and ability to add value.

Attracting and Retaining Young Talent

Employers must offer competitive salaries to attract graduates and professionals under 30 just starting their careers. Some tips include:

  • Emphasise training and progression opportunities that will rapidly boost salaries. Young staff want career development.
  • Offer salaries at least matching market rates for entry-level roles and locations. Research figures for industries and regions.
  • Consider paying above average or minimum wage for those excelling academically or with internships.
  • Provide signing bonuses to graduates where standard salaries are below expectations, e.g. £5,000.
  • Design fast-track schemes for top talent to achieve senior roles and pay within 5-10 years.
  • Set salaries around long-term loyalty, not short tenures younger staff may have.
  • Give regular pay raises as staff gain experience and skills. Budget for rapid growth.
  • Offer incentives like shares, profit participation and annual bonuses.
  • Provide non-cash benefits like social events, office perks, remote work and subsidised amenities.
  • Be flexible around passions like travel, study and side projects to retain creative staff.

With fair early career pay, training and a welcoming environment, you can attract ambitious millennials and Gen Z.

Engaging and Motivating Mid-Career Staff

Once employees reach their 30s and 40s, salaries must reflect growing experience and responsibilities. Retention at this career stage means:

  • Structure salaries based on mastery and contribution – not tenure. Significant pay rises should still occur.
  • Set salaries at least on par with industry averages for specific roles and locations. Research constantly.
  • Outline clear progression paths to the highest salary bands, tied to capability milestones.
  • Provide opportunities for promotion and leadership roles that boost pay and prestige.
  • Train managers to have career conversations on advancement and salary needs.
  • Be flexible and family-friendly to retain parents and carers. Consider part-time and job-share arrangements.
  • Offer sabbaticals, career breaks and extended leave to prevent burnout.
  • Reward loyalty and highly-valued institutional knowledge with higher pay brackets.
  • Customise benefits packages to needs e.g. elderly care support, fertility treatment, and higher leave.

Through engaging leadership and competitive salaries tied to growth, you can motivate mid-career staff during their prime earnings years.

Compensating and Retaining Senior Staff

With deep expertise and contacts, veteran employees over 50 require strategic compensation to retain:

  • Set salaries based on the market value of niche skills and networks, not tenure. Get specialist advice.
  • Structure senior contracts for retention e.g. large notice periods, non-competes, share options.
  • Offer large bonuses for long service and key business outcomes e.g. acquisitions.
  • Provide premium benefits like top-tier health insurance, club memberships and subscriptions.
  • Give additional annual leave, sabbaticals and flexible arrangements.
  • Hire older staff as consultants on short-term premium contracts if full-time roles do not suit.
  • Let highly valued staff shift to non-executive director, advisor or board roles to keep them engaged.
  • Facilitate succession planning to protect institutional knowledge before older staff leave.

While senior staffing costs are higher, their expertise is difficult to replace if lost. Prioritise customised arrangements for retention.

Managing Lower Salaries for Older Staff

Sometimes lower salaries may suit older staff looking for flexibility or reduced responsibility:

  • Clearly communicate how responsibilities, working hours and job demands tie to pay.
  • Set part-time and flexible role salaries pro-rata based on equivalent full-time positions.
  • Offer project, advisory and consulting contracts for short-term engagements with premium rates.
  • Facilitate a transition from full-time work to retirement over several years via gradual workload reductions.
  • Provide exceptional non-cash benefits like extra leave, fitness programmes and social events.
  • Allow older staff to shift to mentorship, coaching and training roles if less stressful roles are preferred.
  • Appeal to their values and purpose to retain expertise even in lower-paid roles.

With mutual understanding and respect, appropriate salaries can be set for all life stages.

Ensuring Legal and Ethical Salary Practices

It is essential for employers to ensure their pay practices are legal, ethical and fair. This includes:

  • Never make salary decisions based on personal characteristics like age, gender, race etc.
  • Following equal pay regulations rigorously – pay should only reflect skills, time worked and responsibilities.
  • Providing identical benefits to all employees regardless of age or tenure.
  • Advertising roles with the full salary range to avoid prejudice on age grounds.
  • Accommodating needs like flexibility without automatically reducing salaries as a result.
  • Allowing older staff to lower working hours over time without salary cliffs or penalties.
  • Ensuring payroll systems anonymise data to minimise potential conscious or unconscious biases.

By focusing solely on performance, skills and market value when making salary decisions, you can build an equitable culture known for fair pay at all career stages. This will help attract and retain top talent across the age spectrum while avoiding discrimination.

Final Tips for Managing Salaries

Here are some final tips for employers looking to improve their salary strategies:

  • Regularly benchmark your salaries against competitors and industry standards to remain competitive.
  • Build capable HR teams responsible for gathering market data, monitoring for biases and ensuring legal compliance.
  • Train line managers thoroughly on fair pay-setting processes aligned with business objectives.
  • Proactively identify and develop high-potential employees for increased responsibilities and promotions regardless of age.
  • Be transparent about pay policies and criteria to manage expectations amongst candidates and staff.
  • Offer clear progression paths tied to capability and development rather than tenure or age.
  • Customise benefits packages based on life stage needs e.g. elderly care, fertility support, sabbaticals etc.
  • Facilitate two-way conversations focused on long-term career goals as well as immediate salary needs.

By taking a strategic, personalised approach to compensation while avoiding age bias, you can build a motivated, engaged workforce empowered to thrive at all career stages.

Summary

Setting fair, competitive salaries that evolve across an employee’s career is key to attracting and retaining top talent at any age. Make pay decisions based on skills, experience and market value, not age. Define clear salary bands for roles and provide opportunities for advancement through promotion.

Managing salary expectations also requires transparent communication about pay policies, regular reviews and demonstration of the value employees will gain throughout their careers.

By following these tips, you can develop an effective compensation strategy that rewards staff competitively at all life stages. This will assist you in building a motivated, thriving workforce positioned for success.

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