City employers are being forced to up pay offers to new recruits in a bid to attract talent amid rising skills shortages, a new survey shows.
Salaries in the insurance sector rose by more than nine per cent in the year to March amid broad-based pay increases.
The broader financial services sector saw pay increase faster than other major professional sectors in March.
Pay in financial services rose by 3.5 per cent in the year to March, more than four times faster than other professional staffing industries, according to the Association of Professional Staffing Companies (Apsco).
Recruiters are currently reporting a dearth of suitable candidates in higher-skilled roles, with the UK labour market at historically tight levels.
UK unemployment has remained at 11-year lows in recent months, while the total proportion of British working-age adults in employment has stayed at all-time record highs.
Average salaries in financial services roles have risen to above £40,000, around 50 per cent higher than the national average.
Ann Swain, Apsco chief executive, said: “As demand for placements via recruiters continue to rise, the search for talent is becoming more competitive, as evidenced by the increase in salaries and rise in forward vacancies registered by hiring companies.”
Vacancies in the finance sector rose four per cent year-on-year, although the relatively stronger increase in the demand for temporary workers may be a sign of some nervousness around longer-term economic conditions.