We often find that recruitment in our space (Strategy & Transformation) follows the trends of the consulting firms. If the consulting firms are busy, we are busy. If the consulting firms are being pulled into digital transformations, we see an increase in demand for said talent.
This year the consulting firms have been flat out, and so have we. This has caused some interesting knock-on effects when we look at the salary trends over the last year.
Typically, year on year, salaries have not changed that much both in the consulting firms and that of the salaries being paid to consultants when joining corporates.
Big corporates have stuck to their guns on salary bandings more often than not and when they cannot afford the top tier talent they require to upskill their internal teams, they have looked offshore.
In the same stroke, we have previously observed management consultants that have transferred and joined the Australian practices from overseas being paid a lower base salary to their Australian counterparts.
Obviously, this is not happening currently with the global pandemic still hindering international travel, and as such this has driven up salaries, quite substantially in some cases, for the first time in years.
The pandemic and lockdowns have seen management consultants take pause and reflect on life choices and there has certainly been increased activity in consultants pursing roles in industry, start-up, and corporate roles.
Because of this we understand some of the top tier consulting firms have increased their base salaries for the more junior management consultants, adjusted levels and titles, and committed to substantial or additional bonuses and early promotions, to retain their talent.
On the flip side of this, some of the tier 2 and big 4 consulting firms, who made some bold decisions last year on redundancies, and bonus or/and promotion freezes, are really struggling to retain and attract new consulting talent, especially as the corporates are growing their internal strategy capability and there is increased interest in roles in the start-up space.
One thing for sure is our clients do not want to lower their standards when hiring, meaning they have to often battle internally to increase salaries to go above bandings.
All this information is only relevant up to a certain pay grade, however. At the senior GM, EGM level and above levels, we have seen some very good, but high-cost talent be let go from the big corporates.
This has created an abundance of exceptional senior talent in the market. We are noticing these candidates opting for contract opportunities, or opportunities back in management consulting, whilst they look for the right role to present itself as opposed to taking a hit on level or salary.
As mentioned, we are observing an increased amount of activity from the local market in terms of exploring opportunities outside of consulting. However, many seem unaware of market pay rates in corporates or start-ups. Some consultants are waiting for promotions in consulting before moving, under the expectation their new salaries will be matched or increased.
Typically, this is not the case. Especially with candidates from the top-tier consulting firms. Corporates are working towards increasing salary bandings in order to try to attract the best talent, but it is very rare they are able to match total packages, especially at the more senior end.
If consultants are coming from the Big 4, this is more doable as we have seen bonuses held back and typically salaries are lower than that of McKinsey, Bain, or BCG (Boston Consulting Group) but in the top tier, where the MBB have recently increased salaries at certain levels, it is becoming harder and harder for corporates to offer commensurate salaries.
Yet, it seems this is not widely known in the community. Clients are often disappointed when they go to market with the salaries they are initially told they have to work within by HR departments and candidates are often disappointed with the salary banding corporates are trying to work within.
This is why using an expert recruiter from the start bypasses this sometimes-lengthy learning process as we are educated on how to manage expectations from the beginning and also how to navigate offers to get a positive result for both client and candidate.
We did a recent survey which highlighted some interesting perceptions.
When stepping out of management consulting, do you expect to receive the same salary in corporate?
No, I would expect an increase
Parity on total package
Parity on base, not bonuses
The role comes 1st, salary 2nd
Essentially, what we advise candidates who are looking at roles in this space, is to think about a few things when they think about salaries.
Cost per hour of work and cost per hour away from home with your loved ones. The latter being hard to quantify in Covid times.
We also encourage individuals to think about a range of other things when determining if a role is right for them.
- Who they are working with and will that individual sponsor promotions for them, develop them and inspire them?
- What is the culture of the team and the leaders, are they high performing and have the same values?
- Where could this role lead me? Will it give me opportunities to grow my skill set? Is there a history of promotions to more senior roles?
- What will I be doing day to day? Is the role clearly defined and if not, can I deal with the ambiguity?
There are so many things to think about that are as important, if not more important as salary.
One of the things a recruiter is taught very early on is never work with a candidate who only cares about the salary and in my experience, this has proven to be great advice.
Top Tier Consulting Salaries
The top tier management consulting firms pay well and up to a certain level, consultants can expect a commensurate level of base salary compensation if moving to industry at best. This changes at the Executive Manager/Senior Manager level. Above this level companies will rarely offer parity. Decent bonuses can be achieved in the top tier consulting firms and vary at each level. Bonuses have remained strong in 2021.
Partner $380k +
Associate Partner $280k-$380k
Executive Manager $190k-$260k
Project Leader/Manager $150k-$210k
Senior Associate /Consultant $130k-$160k
Business Analyst /Associate $100k-$140k
Big 4 Consulting Salaries
Salaries in the Tier 2 or Big 4 consulting firms usually can be matched when candidates take a role in industry. We find some consulting firms underpay their consultants in the market for the title they hold, but sometimes the titles do not reflect the level of experience. Bonuses are generally minimal and in a lot of cases, in 2020/2021, they have been non-existent.
Partner from $280k
Director $180k -$250k
Associate Director/Senior Manager $140k- $180k
Manager $110- $150k
Associate/Consultant $75k- $120k
In-house consulting roles in Financial Services
With most of the Financial Institutions fighting for the same talent, this has pushed up salaries a little in the last 12 months. They generally pay better bonuses than non-Financial Services players in general. An Executive Manager/ Junior Director can expect circa 30-50% bonus in normal years. Senior Director/ EGM levels, again in normal years, can expect up to 100% of base salary in bonus.
Executive General Manager/Senior Director $350k +
General Manager/Director $250k-$340k
Executive Manager/ Junior Director $180k -$250k
Senior Manager $140k-$170k
Senior Consultant/Manager $110k-$150k
Associate/Consultant $90k- $130k
In-house Consulting Roles in non-Financial Services
The major players in this space are the telco’s, retailers, healthcare, airlines and to some extent the energy/infrastructure organisations. We find bonuses generally lower in these organisations ranging from 7% at the more junior levels to 30% typically until you get to the “Head of” levels. Bonuses in 2020/2021 have been hit & miss but many companies have not paid full bonuses.
Executive General Manager/ CSO – $350k +
General Manager/ Principal/ Head Of $250k-$350K
Senior Manager $160k-$220k
Senior Consultant $100k- $140k
Associate Consultant $80k-$110k
For further specific information please contact us directly.