22 January 2004
ON THE UP
The Nannytax/Professional Nanny Annual Survey of UK Nanny Wages
Nanny pay increases across the country, comfortably ahead of inflation, provide a clear sign that the economy has started to pick up. The results come from this year's Nannytax survey of more than 100 nanny agencies for Professional Nanny/Nursery World, suggesting a brighter outlook than last year's survey, which showed relatively modest salary increases.
A significant increase can be seen particularly in the countryside, where nanny salaries, like house prices, can expect to follow the lead of London and the Home Counties. Rural daily nannies are taking home an extra £3,251 a year, with an average wage rise of18 per cent (£273 net per week), and a rise of 12 per cent (£233 net per week) for living in. Live-in nannies in central London have also enjoyed a dramatic increase of 15 per cent over the last 12 months (to £308 net per week), the highest rise seen in this area in the past five years. Average wages for nannies in other cities and towns across the UK rose by a significant 12 per cent (to £276) for daily nannies and by 7 per cent (to £234) for live-in nannies.
Flexible working is paying off for nannies. The demand for part-time, multi-tasking nannies who are willing to do 'wrap-around' childcare (before and after school) continues to grow ˆ indeed, the demand outstrips the supply, as most qualified nannies would still prefer to hold off for a full-time sole-charge position. Participating agencies report a real shortage of full-time jobs and a surplus of qualified, experienced nannies on the market, with 44 per cent of nannies now in part-time jobs or nannyshares. The bright side for nannies is that hour for hour part-time jobs may pay better.
The steady demand for part-time nannies may also suggest that yet more parents are now working from home. But another reason is likely to be the considerable cost to parents, relative to their own salary, of employing a full-time nanny. In the UK they continue to have to pay their nanny out of their own already taxed income, without being eligible for the tax credits that are available to parents using other forms of childcare such as nurseries or registered childminders. This means that a working family in central London paying their daily nanny the average net wage of £386 must earn £19,785 gross each just to cover their employment costs.
Predictions for 2004
A record 110 nanny agencies from across the UK took part in this year's survey. The majority of these agencies predict that salaries will roughly stay the same during the coming year, with a small increase in line with inflation, though a modest 2 per cent predict an increase in real terms (i.e. above inflation).
Nannies in both the north and rural areas are still feeling the effects of an economic downturn, and agencies predict the current decline in nannying positions there to continue well into 2004 as parents opt for childminders and day nurseries, where they can access tax credits. There is also growing competition between agencies as nannies sign on to every agency in their area, desperately looking for work. But in London and the Home Counties there are definite signs that the market in nanny jobs is picking up; several agencies report a considerable upturn in placements in the last few months of 2003, which many expect to continue in the coming 12 months.
The registration issue
The overwhelming majority of agencies participating in this year's survey agree that a nanny register, similar to the Ofsted-regulated registration of childminders and nursery workers, would greatly benefit the industry. It could be argued that by not providing a nanny register with accompanying tax credits for parents, the Government is shooting itself in the foot, as a whole and highly flexible sector of childcare is actually reverting back to only being within reach of the wealthy. This would mean a complete about-turn of the trend seen in recent years towards an ever-wider social base of working parents being able to afford to employ a nanny. Several agencies emphasise that mothers would prefer to employ a nanny as their choice form of childcare when they return to work, but are unable to, as there is no financial support from the Government.
Agencies also argue that a nanny register would not only serve to give nannies the professional recognition they deserve, it would also encourage nannies to keep their skills, such as first aid, up to date.
The prospect of a nanny register does raise some concerns. One agency owner in Swindon says, 'I think it might encourage a black market of unregistered nannies that would be less expensive to parents.' Other agencies worry that a register would be difficult and expensive to operate, and that nannies who have much experience but lack professional qualifications may be excluded.
Agency regulation
The regulation of nanny agencies themselves is another hot topic this year. Most agree that a statutory regulatory body would benefit the industry as a whole. One agency in Guildford says, "I think regulation of nanny agencies would be a great idea, as it would help ensure they are carrying out proper security checks, interviewing all nannies and checking references and documents." But some express concern that the costs involved would be prohibitive to smaller agencies already working on very small profit margins, and push them out of business.
Agencies readily agree that registration of nannies and regulation of nanny agencies would offer great reassurance for parents. As many as 82 per cent of agencies in the survey report that parents are becoming increasingly security-conscious, and approximately 75 per cent of nannies now have an enhanced Criminal Records Bureau disclosure; indeed, 38 per cent of the agencies say they refuse to place a nanny without one.
The big picture
This year's survey shows that approximately 35 per cent of nannies are being offered perks and benefits on top of their salary. Foremost among these are the use of a car outside of working hours, or petrol allowance if a nanny uses her own car. Other perks include health club membership, a Christmas bonus and mobile phones.
Overall, this year's survey shows that while it is still an employers' market, more parents are now willing to pay well for a good nanny. In a period of increased international tension and a climate of greater uncertainty, it seems that parents value a loyal and reliable nanny more than ever.
But although nannies' salaries have risen in real terms over the past 12 months, nannies working full-time are now fewer in number than a few years ago and there is less movement generally. The pay increases tend to reflect the more affluent top end of the market, while many parents at the lower end have simply dropped out. With a larger proportion of parents either working part-time or working from home, nannies need also be aware that the traditional full-time sole-charge job is becoming less commonplace, and that to make those higher earnings they need to brush up on their skills and be prepared to be flexible