Average salary increase is just 2.5 per cent

THE average salary in Jersey increased by just 2.5 per cent during the last year – the second-lowest rise since 1995.

Economic Development Minister Alan Maclean

THE average salary in Jersey increased by just 2.5 per cent during the last year – the second-lowest rise since 1995.

According to figures released yesterday, a full-time worker now earns an average of £650 per week, or £33,800 per year.

Although the rise is higher than the 1.1 per cent increase seen in 2009/10, it is significantly lower than the increases seen during the previous 15 years.

Economic Development Minister Alan Maclean said: ‘The earnings growth rate does remain low in historic terms, but that is not unexpected given that we have a weak labour market and a challenging economic climate.’

• The weekly old-age pension for a couple will go up to £306.25 per week from October, in line with the 2.5% rise in the average earnings index.

• See Tuesday's JEP for full reports

Comments for: "Average salary increase is just 2.5 per cent"

Delta

My employer gave me an increase of 3.1% on my very modest salary of 20K - I came home to find the cost of living in Jersey had gone up 3.0% according to the JEP - I'm still in the game!

Michael Eppier

Average wage increase 2.5% - Cost of living up by 5% - go figure !

The house market is in decline - the retail sector is suffering, and we have a pension time bomb waiting to off - how long before somebody in government tells the truth and admits that Jersey has major structural issues

Luke

Who got a pay rise?

Who earns £650pw?

Where do you get you information? This is rubbish, I have not had a pay rise in 6 years and if you actually ask the people of Jersey you will hear a lot of the same.

Lies and corruption is all you know and soon you will feel the backlash.

small money

still waiting for my barely keep up with the cost of living rise , like many others no doubt.

and know that i am not getting one and do not expect one next year , th eonly thing i can hope for is a full weeks work and not the missing hours here and there,that comes out as a four day week.

Nigel Pearce

Isn't it strange how the rates of increases in wages, RPI etc. always are low just before the pension re-assessments are due to be made, plus no allowance for the increased GST.

it's funny

a full-time worker now earns an average of £650 per week, or £33,800 per year.

ops i only get half...

small business

What about "payoffs" will they be 2.5% also

Jambo

I think this must be based on the public sector!

bella

5

Agree with you

There is definitely something fishy going on.

Food now goes up on a weekly basis.

In real terms we are all worse off than we were 3 years ago.

Fuel, electric, gas all up,some-one is making a tidy sum for themselves.

Remember the words of one politician "there will be no recession in jersey" 2 or 3 years ago?

He can now eat his hat!

Lynda

Like many of my colleagues in the much maligned Finance industry, I haven't had a pay rise or cost of living for three years now. GST has increased, rates have increased, user pays is biting. We are all swimming against the tide and Michael (2) is correct, the pension time bomb of civil servants has not been addressed by weak leadership.

And yet, I am thankful I live here, that our island has no borrowings (sorry Geoff Southern) and we are luckier than most. There is a global timebomb about to go off with countries unable to meet repayments and whilst this will effect us deeply we won't see the financial meltdown of some other economies.

Michael

Number 5

Totally agree Nigel: If you believe Jersey Government Statistics you must be mad and all so believe in fairies!! Jersey Statistics all-ways come out in support of our lousy Government!!!

henry5

i lost my job last year with benifts im only £28 a week worse off and getting a 2.5% pay rise lol im starting to feel abit sorry for people that do work now days

tonyb

working is becoming a mugs game

mike hunt

A lot of people have been misinformed. When the pension time bomb goes off the public are not liable for the shortfall. It's the states workers.

PIMCO Boy

And Lynda you and your colleagues in the Jersey Finance industry helped facilitate the explosive and unlikely to be repaid debt explosion of that bubble period by the kind of finance vehicles we do over here. Nice!

mams

a full-time worker now earns an average of £650 per week, or £33,800 per year?????

Where is that job i will jump into tomorrow.

Im on full time work and i only get £18500 a year and that working 39 hours a week. Now deduct Tax and Insurance, add GST and Cost of Living.

see what's the out come.

we need new government, new people who doesn't hide anything.

dave

2.5% is more than in the UK and it's more than the rise in Jersey last year.

Bank Worker

Pimco Boy -

And Lynda you and your colleagues in the Jersey Finance industry helped facilitate the explosive and unlikely to be repaid debt explosion of that bubble period by the kind of finance vehicles we do over here. Nice!

Very few and I mean a small minority of finance workers were in any way involved in the banks going bust. Most who work in finance are not even directly involved with the financial side of things, they work in I.T/Property/Relationship management/Fiduciary/ Customer service and a host of other areas. The big bosy responsible are still getting pay rises and bonuses, the rest of us and keeping our mouths shut and hoping to keep our jobs.

BTW for those that don't understand the way averages are calculated, takle the number of people employed divide by the amount being earned in total = average. This means that there are some fat cats earning a lot of money ( they are in the minority ) and the majority earning not much, this balances out as an average of £33,800 per year average wage.

In reality the real average wags is probably around £20K most people in finance are earning slightly more than this figure, you average bank teller is probably on £22K.

Beaumont

I'd be interested in how they calculate those figures.

It's almost certainly a 'mean' average. When you add a few salaries of £100k+ into the mix, it totally distorts the true picture.

I suspect a 'median' average, or 'mode' average will produce totally different figures, figures that will far more representative of the average Jersey family

dave

No. 18

According to the average earnings report the mean salary for all sectors is approx £520 per week/£27k p.a.

Jimmy

No.19

If you have a look at the earnings report, they have done median salary: £520 per week (that's 27k/year), so yes it is lower than the mean average. By definition, half of workers will earn less than the median, and half will earn more than that. Sounds feasible to me.

dave

Correction : I should have said the MEDIAN is £520 per week.

Anomoyous

Oh my God

"i lost my job last year with benifts im only £28 a week worse off and getting a 2.5% pay rise lol im starting to feel abit sorry for people that do work now days"

Why are we paying anything to support people with attitudes like this, what's the incentive for them to go find a job, its no wonder we can't afford money for the important things when we're wasting on people who clearly aren't bothered if they work.

fred

£33k a year, i couldn't live on that Jersey is poorer than I thought! As long as I'm alright to hell with the rest of you, if I were on that sort of chicken feed, I'd be on benefits like henry5! £60k is my get out of bed starting rate....

Mike

We have no God-given right to be better off year after year after year. This is a misconception common amongst developed Western societies, and it is time that everyone took a long, hard reality check. The sun rises in the East and before too long it will be setting there too. And I don't mean in Gorey.

Nigel Pearce

Dave 17.

I don't see the relevance of comparing Jersey with the UK. With the rise in retail price index in Jersey, plus the 2% increase in GST , I am still worse off after the pension increase.

No Axe to Grind

Almost all comments above are entirely anecdotal. The report concerned was based on averages that might not (almost certainly will not) apply to you.

So much of what is reported as fact by posters on this forum is nothing of the kind, often totally wrong. This helps nobody and can potentially do damage.

The simple fact about pay rises is that you are fortunate to be in work and getting any rise at all. We have all been living (as a community) beyond our means. To correct the situation as painlessly as possible, and it has to be corrected, is to be worse off; yes worse off. The alternative is very much more pain.

Sorry, but it's the truth.

Spelling Bee

24 Fred -

£33k a year, i couldn’t live on that Jersey is poorer than I thought! As long as I’m alright to hell with the rest of you, if I were on that sort of chicken feed, I’d be on benefits like henry5! £60k is my get out of bed starting rate….

Who the hell pays upwards of £60K a year to a man who doesn't even know that names begin with capital letters as does the word I.

Dave

Nigel 26.

"With the rise in retail price index in Jersey, plus the 2% increase in GST"

The retail price index inlcudes GST - are you not double-counting?

Real Truthseeker

That is quite a decent and fair rise, considering States members are taking no rise at all.... and here you lot moan about States members.... but you like to ignore these types of decent States decisions.

Suisse Tony

2.5%,not enough to fund the increase on the good old German sports car one has to drive around in!

James Wiley

There is no way the real rate of inflation is any less than 10% - think chinese inflation is 9%, the devaluation of the pound against the yuan is 20% and the increase in the price of commodities is around 50%. Maybe it hasn't hit yet but it will and hard.

Every government is desperately printing more and more money to keep pace with the americans who just agreed to print $2.4 trillion more.

Let's not forget that there is also the last year of losing tax allowances for 20 means 20. There is an increase in social security coming - and another increase in october if soon to be former member of the states gorst is to be believed.

A responsible States would be lowering taxes, lowering government spending and de-regulating the finance industry and other commercial operations so that they can grow rather than be choked in bureaucracy.

Any measurement of economic growth must exclude the public sector - which is not really part of the economy.

Less government workers means less immigration means lower housing cost and lower taxation. If no one has any money then there can be no economy.

The government is completely wrong in its entire policy.

James Wiley

In fact we are getting poorer by the year... the effective rate of tax is up from 15% in 1980 to 32.5% in 2010 (and I include all taxes including SS in that). Not that the statistics unit produces these 'dangerous' statistics but it isn't hard to calculate.

Rentals remain at roughly 50% of salary which means we are graciously allowed 17.5% of our earnings upon which to live.

The government really has lost the plot.

Parktown Prawn

RT

Misinformed as usual!!

At least make an effort to do some research before parading your ignorance.

http://www.bbc.co.uk/news/world-europe-jersey-11767829

£800 rise in 2011 ... "The increase will bring members pay up to almost £45,000 a year"

....well above the suggested average of £33k per annmum!!

...and 2012?

They "may" not get a pay rise.....interpret that how you will, but I have a hunch they WILL still get one!

Dave

No 33. Where on earth do you get an effective tax rate of 32.5% from?

Real Truthseeker

Parktown, the facts are straight. They have not taken a pay rise. They did before, but they have refused to take one in the next buidget...

Facts my dear, please... for a change!

Shut up and Pay

Just to respect the unlucky ones who didn't get a pay rise . DON'T BOTHER PUBLISHING FIGURES WHO DO NOT REPRESENT THE MAJORITY OF THE POPULATION.

James Wiley

Social Security is 8%, income tax is 20% (less some for threshold), GST is 5%, add impots on alcohol, petrol and cigarettes, parish rates, user pays stealth taxes such as prescription fees and planning application fees, airport landing fees.

It is probably more than 32.5% but I used the government's own statistics for what an average household spends on the above.

The greatest increase in taxation has been in stealth taxes.

For the record I define a tax as any money which is received by government.

RT - States members are accepting an increase in expenses though so they are not really having a pay freeze they are just calling it something else.

James Wiley

@35 of course the government could provide their own statistics if they so wished.

small money

james wiley(33).

you have the finger on the pulse of my life , almost to the penny.

i will be free of rent , and mortgage one day (next year hopefully).

but i will still need work to put food ect on the table.

Dave

James, thanks for your response.

Few people pay income tax at 20% due to the marginal calculation rules.

Even a single person aged under 63 with no children and no mortgage on a median salary of £520 per week has an effective income tax rate of just over 14%. That person would have to earn over £49,000 before he paid income tax at 20% http://www.gov.je/TaxesMoney/IncomeTax/Individuals/AllowancesReliefs/Pages/MarginalCalculation.aspx

I also thought that employee social security contributions were 6% and not 8%

http://www.gov.je/Working/Contributions/Employers/Pages/ChangesEmployerContributions.aspx

Finally, GST is not payable on items such as mortgage interest and rent, so an individual would only incur GST on the balance of money he has left and spends after he has paid his tax, social security and rent/mortgage. I estimate that around 3% of a persons gross income would go on GST.

Colin

This kind of story really gets my back up, to say that the average wage in jersey is £650 per week is a good example of how out of touch jersey politions are with whats going on in the island. I don't earn anything close to that amount and i'm sure a lot of people living in jersey are the same, what about the people who work in retail or in tourisim for example, even a lot of people who work in the banks don't earn this much. They should publish the figures from the different sectors, to show how they came to this conclution, so people can see the real picure of the varied work force in jersey and don't paint a picure that a majority of people are well of, because they are not.

colin

oops spelling mistakes in my coment, thats not good, politions should be spelt Politicians

Beanie

Been here nearly 13yrs, breaking my body physically just to pay my way. Never earned more than £20,000 a yr and some yrs £13,000-£15,000 thats working no less than 40 hrs but up to 60hrs.When i do leave jersey i will be leaving with a bag that i came with and no savings ,my money stays in jersey and i will have the memories only...... sort ur stats out and stop bullshitting us !!!!!!!!

James Wiley

Dear Dave,

Social security is in fact 12.5% it is just if you are employed your employer pays 6.5% on your behalf.

Many people are self employed so this raises the average SS accordingly. Arguably if the employer did not pay the 6% he might pay you more but that is another debate.

I have already accounted for threshold on income tax - remember we are talking for an average (mean) household which will have people earning average (mean) wage which in 2010 was over £40,000. They have just changed the way they measure it this year.

I don't think you realise just how much of the cost of petrol, alcohol and tobacco is tax...

So even using your figures which as you note are for a median average household not a mean average household, 14+6+3 = 23% and that is before you are accounting for any stealth taxes. You have to use the mean as that is what is used to compile the government statistics on household expenditure.

However if you wish to present an alternate calculation including all taxes and not just 3 then by all means let's discuss where our calculations differ and work out which is the better basis to calculate them on.

Dave

James,

I think it is fair to use the median rather than the average, because half the population earn more than £27,000 and half the population earn less. The average is distorted by a small number of very high earners. On these earnings (27k), the maximum income tax a person will pay is 14%, but in many cases it will be much lower or nil, as the person may be married, have dependent children or pay mortgage interest (which is still deductable at the marginal rate).

I do agree with you that taxes have risen, especially in the last few years, but income tax for the low and middle earners maybe not have risen as much as you think because of the marginal calculation rules.

Taxed To Death

What I don't understand is why we are taxed repeatedly on the same sum of money. We are taxed on our earnings, we are taxeed again if we spend some of what is left, if we save we are taxed on the interest.

Why is the same sum of money taxed at every juncture, tax us once and be done with it.

As George Harrison said, "Im the taxman and you're working for no one but me"

had enough

Here in uk i work 40 hours per week, take home £256 a week, have to pay rent, council tax etc, i get no help

Aleksandr Orlov

Here in Meerkova, 100 hours per week take home 30 Meerks, barely enough to feed my little baby Meerkats. Mrs Meerkat always wanting new shoes, Junior wants the latest meerkat video game, it is making me sad in my meerkat tummy.

I am thinking of jumping ship to work for comparethemarket.com. I can take the boat out in the morning - simples.

Mike

Very odd that James says that the Government has lost the plot, given his misuse of statistics. Just to pick up one one, for absolute clarification, an employee suffers a 6% deduction from their pay for Social Security, not 12.5% nor 8%. The employers' social security cost of 6.5% is no more part of the employee's tax bill than the cost of rent, utilities, insurances, etc etc etc.

And for Income Tax, as Dave points out, you have to be a high earner to actually pay 20%.

So, nicely distorted James.

James Wiley

I agree Dave, but the most stupid thing of all is that first they tax people (and have all the cost of collecting taxes) and then they give those same people money back in benefits (and have all the cost of administering benefits.

It makes far more sense to me just to raise the tax threshold significantly and not give out benefits.

Of course I am not trying to increase my department's budget or quota of staff...

As to pensions... well I am 45 now and by the time I am 67 there will be no money in the pension fund. It is past time the pension was means tested - in fact it could be done away with and those elderly people who needed to could claim income support.

Social security is a tax and nothing besides.

James Wiley

'Mike' I invite you to do your own statistical calculation and calculate the final figure. Then we can discuss methodology.

Just don't miss any of the taxes out... there are more than 3 taxes, many, many more.

Real Truthseeker

Mike, spot on, only high incomes earners pay 20%, and besides a high income earner will still receive mortgage and child-care relief if they have either, so even then they won't pay 20%.

James tends to make up numbers to suit an otherwise invalid argument - same as Pip Clement.

Mike

RT, thanks, but wouldn't it be nice if just for once a blogger (let's take James as an example) could actually say something like "what I said about employees being taxed at 12.5% from social security was completely wrong and I am sorry for contributing such absolute nonsense".

Wouldn't it?

Gary

RT & Mike - income tax for all is 20%, except for those low earners whose total income is in excess of their exemption threshold who fall into what is termed the 'marginal band', calculated at 27%., or 1.1.K's, of course.

It would be interesting to hear why you think low earners in Jersey actually pay higher income taxes than those in France, Germany or most other european countries (including accounting for thresholds) - whereas, of course, high earners pay far less.

Pip Clement

The headline rate may be the same at 20% but the fact that personal allowances have risen by less than the rate of inflation and 20 means 20 has resulted in islanders paying more income tax.

Income tax is a bigger and deeper shovel in islanders pockets than it was in 2000.

Add in above inflation duty rises on alcohol and tobacco for health reasons, extra duty on road fuel for green reasons plus 5% GST on everything.

Jersey may still be a low tax jurisdiction but compare it with Jersey in 1980 and you will realise that islanders pay a lot more tax now than then as a percentage of their incomes plus a much higher proportion of expenditure is now handed straight over to the Treasury as it is tax collected on their behalf.

Not only that but with the deficit reduction scheme running out of steam and the stabilisation fund dwindling fast it is likely we will have a hike in GST in a year or two.

Not many candidates will be admitting that at the hustings!

James Wiley

Only about half the tax paid is income tax, conveniently ignoring the rest of the taxes may give you peace of mind but it is not realistic.

steve

53 RT - A high incomer earner will not benefit from mortgage interest relief, only lower tax payers on marginal rate qualify for mortage interest relief

Catherine

56. Pip

I think you mean: not many candidates will understand that at the hustings (if previous calibres are anything to go by)