BBC News Online: Business

Director pay rises 13%

Directors
£121,011

Managers
£38,939

The increase reflects a 34% rise in the size of bonuses paid to the people who run UK plcs and comes after a 10% fall of the stock market in 2000.

But the Institute of Management says the rise reflects economic performance in the period 1999-2000 before the stock markets plummeted last year.

Economic buoyancy

"This big rise in bonus payments reveals the extent of economic buoyancy and business confidence in the UK during the period covered by the research," explains Mary Chapman, director general of the Institute of Management.

Last year's market falls and the extent of the US economic slowdown's impact on the UK will not be reflected by bonuses until next year.

"The next set of figures might tell a very different story," said Ms Chapman.

Who benefited?

Most of the increase in pay was due to the 34% boost in the bonuses.

The average bonus rose from £20,856 to £28,071 in the 12 months up to January 2001.

The boost follows a dip in executive pay increases by 1.2% in 1998-99.

Directors in the food, drink and tobacco industries enjoyed the biggest overall increases - up 20.4% - while those in the public sector did least well, averaging an earnings rise of only 4%.

The survey is based on a sample of 598 directors and 19,238 managers from 421 companies.

The Institute of Management (IM) is the largest organisation for professional management in the UK, representing almost 89,000 individual members and 560 corporate partners.