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How remote working has impacted regional salary differences in the UK

Since the rapid adoption of remote working at the start of the year, much has changed within the landscape we all work – patterns, processes and priorities have all shifted, seemingly permanently. While many of those changes have been rightly covered and highlighted, there are still some consequences of the ‘new normal’ that haven’t been discussed as much as they perhaps should’ve.


One new phenomenon that we’ve been noticing during conversations with both clients and candidates is that salary considerations have become far less localised than they had been previously, which is widening the net for some businesses, while hindering recruitment for others. For example, pre-pandemic, when most roles were predominantly office-based, the locality of candidates was a large consideration for hiring managers and organisations – however, working remotely, this is no longer the case.


With a known disparity in wage budgets dependent on location to account for cost of living, London-based businesses are now able to attract talent further afield – offering them more competitive terms – effectively pricing more ‘local’ competition out of the market for unicorn talent. Working remotely with no need to relocate, candidates who weren’t previously capable of earning a certain number in the area in which they’re based now have that option open to them. While this is clearly a great situation for top-tier talent and businesses with deeper pockets, is does beg the question as to how smaller, more location-dependent organisations adjust to ensure they don’t lose the quality of talent they wish to attract.


While the obvious remedy would be to simply offer more money, the issue of affordability is a real one. For smaller outfits with more regional talent appeal, their natural ability to offer the best talent in the area competitive salaries for their region has now been dramatically undermined. With the need to either live in or commute to London now removed for those wanting the largest packages, candidates cannot be blamed for effectively making hay while the sun shines.


Remote working will not be a temporary consideration so this isn’t likely to disappear once offices become safe spaces again. More than any other sector, tech has transitioned to remote teams and working from home almost seamlessly, and to think that things will simply revert to type once the pandemic has passed seems somewhat naïve, especially with so much goodwill toward the benefits home working has allowed for – even under these unprecedented circumstances.


Whether you’re a business on either side of this debate, or a candidate who’s wanting to evaluate the options that might now be available to you, please don’t hesitate to get in touch so that we can discuss further. 2020 has been a year of immense change, and the tech industry isn’t excluded from that – hopefully by working together, we can ensure those changes are more positive than the alternative.

 

David Robinson
UK Practice Lead, Amsource

 

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