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July, 2009
Paul Walsh and
Jenny Lyon advise actuaries to look beyond the headline salary when
considering a move abroad
Actuaries provide a good example of a global profession. Working in different countries has become relatively easy as actuarial skills are often readily transferable. As we move towards international consistency for the term “actuary” and further recognition between the different actuarial bodies this will only improve overseas opportunities for actuaries. One outcome of the Global Financial Crisis is a major shift in thinking as people are forced to re-evaluate their lives and careers. Current economic conditions have resulted in reduced employment opportunities in some countries and individuals are considering where the opportunities are most likely to exist in the future.
The many factors you consider when reviewing your career options carry different weight depending on your objectives. However the salary package and conditions you can expect usually form a significant part of any decision. An overall understanding of how other countries pay their staff and the level of benefits available is a useful starting point.
The first thing to remember is that it rarely, if ever, makes sense to convert your current salary to another currency and assume you should target this amount. Recent variability in exchange rates highlights this (see the table below) and you also need to consider tax rates and cost of living. For example, in Singapore you would not expect to pay more than 15% tax while in the UK you could be paying up to 40% tax. Differences in worldwide costs of living are also highlighted in the Mercer survey below. Also some companies and countries offer pension/superannuation and health care benefits in addition to the headline package figure whereas others include them in the total.
For example Acumen’s annual actuarial salary survey of qualified actuaries in Ireland includes a car allowance factor as part of the package, as well as bonuses and pension. In Australia we look at guaranteed salary (base salary plus superannuation), with the only additional package item typically being discretionary bonus.
To give an example of how different base salaries can be between countries (and even at different times) the following table illustrates average data for newly qualified actuaries in different countries and then converts the local currency to sterling at both 31 March 2009 and 30 September 2008.
|
Country |
Base Salary in local currency |
Illustration in £ at 31/3/09 |
Illustration in ₤ at 30/9/08 |
|
UK |
Stg£55,000 |
£55,000 |
£55,000 |
|
Australia |
A$113,000 |
₤53,976 |
₤50,960 |
|
Ireland |
€70,000 |
₤64,614 |
₤55,904 |
|
New Zealand |
NZ$110,000 |
₤43,364 |
₤41,352 |
|
Singapore |
S$96,000 |
₤44,234 |
₤37,283 |
Note that these numbers are based on the data for when a person qualifies, they do not take any other factors into account and should be treated as only a part of the overall position.
|
Rank March 2008 |
City |
Cost of living Index March 2008 |
|
1 |
Moscow |
142.4 |
|
2 |
Tokyo |
127.0 |
|
3 |
London |
125.0 |
|
6 |
Hong Kong |
117.6 |
|
9 |
Zurich |
112.7 |
|
13 |
Singapore |
109.1 |
|
15 |
Sydney |
104.1 |
|
16 |
Dublin |
103.9 |
|
22 |
New York City |
100.0 |
|
37 |
Munich |
93.1 |
Source: Mercer
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The table below shows the impact of tax rates and the cost of living - while someone in Singapore is deemed to have a lower salary when converted to sterling, when tax rates and cost of living are factored into the equation the person comes out better off.
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Getting information on actuarial salaries can be difficult as the profession is small and there is a limited amount of data publicly available. It is usually not advisable to raise the issue of salary directly with a potential employer early in the process – you want to convince them that they want to hire you before starting the negotiation process. Talking to friends is not always a good indication as there are so many factors - the actual role and responsibilities, the level of qualification, current market and company conditions, quality and relevance of experience and of course there is some risk that people inflate their package or forget some add-on benefits they receive.
A good recruitment consultant should be able to advise you on the expected level of salary for a position you are applying for and be able to discuss the way in which benefits work within the company. They also act as your intermediary and negotiate on those items which you feel are particularly important for you. If you are considering an overseas move ideally your recruiter will be able to provide an overview of conditions in different countries and what you can expect.
If your reasons for making a move are more lifestyle based than financial then the amount of annual leave you get will be important and it does vary by country and company. In Australia 4 weeks is standard and if you are used to 5 or 6 weeks (as would be the case in some other countries) it can feel quite limiting particularly if you want to factor a trip home most years.
Extract from Acumen’s Australian salary survey -
|
Years of Post qualification Experience |
Average
|
Median
|
|
0 |
$111,339 |
$113,300 |
|
1 |
$116,731 |
$114,000 |
|
2 |
$145,925 |
$140,000 |
|
3 |
$141,618 |
$135,160 |
|
4 |
$179,434 |
$185,300 |
|
5 |
$173,985 |
$179,850 |
While salary is an important factor when making any move it is also important to remember that the additional experience you will gain from working in a new and potentially challenging environment will provide you with skills which will enable you to further leverage your career or to help you define the niche in which you want to find yourself. Many of the candidates we have helped make an overseas move have found that they are given opportunities to work in a way not available in their home country whether this be from a technical, management or commercial perspective.
So whilst the package alone may not entice you to pastures new, considering an overseas move as a long term investment in your career may well tip the balance.
Jenny Lyon is Managing Director of Acumen Resources in Asia Pacific.
Paul Walsh is CEO of the Acumen Resources Group.
In 2008 Acumen Resources conducted salary surveys in Australia, New Zealand, Ireland and Singapore and are planning to conduct one in the UK in 2009.