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Average Weekly Earning: Bonus payments in Great Britain, 2011-2012 This product is designated as National Statistics

Released: 19 September 2012 Download PDF

Abstract

ONS analysis on bonus payments in Great Britain examines total bonuses received across the whole economy in 2011/12.

£37 billion paid out in bonuses in 2011/12 – up 3 per cent on a year earlier

Total bonus payments received across the whole economy during the financial year April 2011 to March 2012 (2011/12) totalled £37 billion, an increase of 3 per cent compared with 2010/11. This equates to an average of around £1,400 per employee in 2011/12.

Of the £37 billion paid in bonuses in 2011/12, £13 billion was paid out to employees of businesses in the finance and insurance industry. This was a 9 per cent fall from the 2010/11 level. Despite the fall, financial sector bonuses made up 36 per cent of all bonuses in 2011/12, even though just 4 per cent of all employees work in the industry. Finance and insurance bonus payments remained significantly below the levels seen during 2006/07 and 2007/08, when bonus payments peaked before the onset of the financial crisis.

The increase in bonus payments for the whole economy was driven by the rest of the economy, which experienced a 12 per cent increase in bonuses. Overall, bonuses paid to employees in the rest of the economy in 2011/12 were almost as high as bonus payments in 2007/08, when bonus payments were at their peak.

Figure 1: Total bonus payments by financial year (April to March), Great Britain

Graph showing Total bonus payments by financial year (April to March), Great Britain
Source: Office for National Statistics

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Weaker ‘bonus season’ drives drop in bonuses in finance and insurance industry

The finance and insurance industry pays the majority of its bonuses in December to March, sometimes referred to as ‘bonus season’.

In 2011/12, 69 per cent of all bonuses paid in this industry were made during bonus season. Bonuses paid in the rest of the economy during this period (December to March) represented 48 per cent of total bonuses, with more bonuses paid in March than the other months.

Bonuses in the rest of the economy were more evenly distributed across the year as a whole, compared with the finance and insurance industry.

Figure 2: Total bonus payments received: by month of pay, Great Britain

Graph shows total bonus payments received: by month of pay, Great Britain

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Figure 2 shows that while bonuses paid in the finance and insurance industry in 2011/12 were broadly in line with 2010/11 for most of the year, the gap widened considerably between December and March, when the majority of large annual bonuses were paid. Bonus payments in this industry peaked at £3.5 billion in March 2012, which was considerably lower than the peak of £4.3 billion in February 2011. In contrast, bonuses in the rest of the economy in 2011/12 were higher in most months compared with 2010/11. 

Professional, scientific & technical and information & communication industries among positive contributions to bonus growth

The professional, scientific and technical and information and communication industries made the largest positive contributions to bonus payments in 2011/12. Both these industrial groupings paid £0.6 billion more in bonuses in 2011/12 than in 2010/11.

Figure 3 shows the contribution each of the 24 lower level industries made to the change in whole economy bonus payments between 2010/11 and 2011/12.

Figure 3: Contributions to Total Bonus Payments: By Industry, Great Britain

Graph shows contributions to Total Bonus Payments: by industry, Great Britain

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Bonuses paid in the wholesale trade industry were the third largest contributor to the increase in bonus payments between 2010/11 and 2011/12, contributing £0.4 billion. Real estate and administrative and support services also made substantial positive contributions to the growth in whole economy bonuses, each contributing £0.3 billion respectively. The finance and insurance industry made the largest negative contribution to bonuses, contributing -£1.4 billion to whole economy bonus payments.

Average bonus per person up across most industries

In 2011/12, the average bonus per employee was £12,000 in the finance and insurance industry. This was a decline of £1,500 or 11 per cent compared with the average bonus received by financial sector workers in 2010/11. However, the bonus per employee remained substantially higher in finance and insurance than in any other part of the economy.

The industry with the second highest average bonus was mining and quarrying (including oil extraction and exploration), with an average bonus per employee of £6,900. This was an increase of 9 per cent compared with the average bonus per employee received in 2010/11. Despite the high bonus per employee, the mining and quarrying industry contributed very little to total bonus payments at whole economy level (see Figure 3). This is because the industry employs a very small proportion of the total workforce (0.2 per cent). The majority of other industries saw an increase in the average bonus per person.

In 2011/12, the average private sector worker received £1,700 in bonuses, more than five times the average public sector worker’s bonus of £300. The average public sector bonus includes the temporarily nationalised banks; excluding financial services, the average public sector bonus was £100. However, private sector workers on average get lower regular pay than people working in the public sector, with bonus payments being a more significant part of total pay in the private sector.

Table 1: Annual average bonuses per employee: by industry, Great Britain

  £ thousand
  2010/11 2011/12
Financial and insurance activities 13.5 12.0
Mining and quarrying 6.3 6.9
Information and communication 3.8 4.4
Wholesale trade 2.1 2.5
Real estate activities 1.6 2.4
Manufacturing: Chemicals and man made fibres  2.5 2.3
Professional, scientific and technical activities 2.0 2.3
Electricity, gas and water supply 1.8 2.0
Manufacturing: Engineering and allied industries 1.1 1.2
Manufacturing: Basic metals and metal products  1.0 1.0
Construction 0.9 1.0
Manufacturing: Food, beverages and tobacco  1.1 0.9
Other manufacturing 0.8 0.9
Retail trade and repair 0.8 0.8
Administrative and support service activities 0.7 0.8
Other service activities 0.8 0.7
Arts, entertainment and recreation 0.6 0.6
Manufacturing: Textiles, leather and clothing  0.7 0.6
Transport and storage 0.6 0.6
Agriculture, forestry and fishing 0.6 0.5
Accommodation and food service activities 0.3 0.3
Public administration 0.2 0.2
Education <0.1 <0.1
Health and social work <0.1 <0.1
     
Private sector 1.7 1.7
Public sector 0.3 0.3
Public sector excluding financial services 0.1 0.1
     
Whole economy 1.4 1.4
   

Table source: Office for National Statistics

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Background notes

  1. All figures are derived from the Average Weekly Earnings (AWE) dataset, part of the Labour Market Statistics release.

  2. There is a Podcast to accompany the Bonus payments in Great Britain article.

  3. The data does not include the Armed Forces, government–supported trainees or the self employed.

  4. Due to rounding, percentages may not always sum to 100 per cent.

  5. Details of the policy governing the release of new data are available by visiting www.statisticsauthority.gov.uk/assessment/code-of-practice/index.html or from the Media Relations Office email: media.relations@ons.gsi.gov.uk

    These National Statistics are produced to high professional standards and released according to the arrangements approved by the UK Statistics Authority.

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