Ask AI how much tech folks get paid and the answer is: “Tech salaries in London and the UK vary significantly based on experience, role and specialisation. Entry-level positions may start around £45,000, while experienced professionals can earn upwards of £120,000.”
Then comes this: “The tech industry is experiencing fluctuations due to factors like AI, which is impacting job demands and potentially leading to shifts in salary expectations.”
Finally, we get to: “Emerging technologies are hot: roles requiring skills in areas like artificial intelligence, machine learning and cloud computing are seeing higher-than-average pay increases.”
Hot is one way of describing a tech industry in which a CEO has been hired on a salary of $94 million (£69.5 million), or 1,300 times more than the company’s average employee wage. The board of Lattice, a US chipmaker in Oregon, approved the payout to tech executive Ford Tamer to lure him from investment firm Francisco Partners. The company stresses that nearly all of his pay is tied to stock performance. Shares in Lattice rose 12 per cent on the day he was appointed. “By that metric, perhaps, Lattice shareholders have already gotten their money’s worth,” the local newspaper, The Oregonian, noted.
Tech is matching, even surpassing, football for signing-on fees
The point is that Lattice is little-known — it’s not one of the giants. To hire someone like Tamer, 62, who has held down senior positions in Silicon Valley and elsewhere and has a PhD in engineering from MIT, shows the lengths firms must go to in order to attract top talent.
Whatever the AI says with understatement, tech is matching, even surpassing, football for signing-on fees. There, it is not only the mightiest clubs that are having to find ever larger sums — the lesser teams are also feeling the trickle-down effect. They are still in the same market.
Tamer’s mega-bucks may be eye-popping to some but not to others. OpenAI chief Sam Altman has accused rival Meta of offering $100 million bonuses to AI engineers to jump ship, forcing his corporation to reassure staff it was “seeking creative ways to recognise and reward top talent”. It’s not clear what that means exactly, since OpenAI is known for paying near the top of the market already. Expect details of even juicier packages to emerge.
The war has prompted some seasoned observers to shake their heads at the craziness of it all. Kyle Langworthy, an AI recruitment specialist at Riviera Partners, described it as having “just become manically more hyper-intense”. Certain companies, he said, “are willing to do anything or whatever it takes to bring that talent into the organisation”.
Last month, OpenAI gave its staff a week off to rest and recharge, only to see Meta exploit the unexpected company-wide break and use it to contact OpenAI staffers and pressure them into moving across.
All of which is good news for digi hubs outside the Valley, with London at the forefront. As the US pool is drained, attention is turning elsewhere. How the UK’s High Pay Centre, which campaigns for fairer pay, is going to deal with that remains to be seen. This week it published a report revealing the bosses of Britain’s largest listed companies have taken home record high pay packets for the third successive year. Its analysis found the average FTSE 100 chief executive is now paid 122 times the salary of the average full-time UK worker, which begs the question — have they seen Tamer’s 1,300 times?
FTSE 100 companies spent more than £1 billion rewarding 217 executives
The median wage of a FTSE 100 chief climbed to £4.58 million in the past year, up from £4.29 million. The study revealed that FTSE 100 companies spent more than £1 billion rewarding 217 executives. Heading the list were the current and former bosses of Melrose, the UK engineering company. Peter Dilnot and Simon Peckham between them collected £59 million in the past 12 months. That was calculated largely on long-term incentive payments.
Next were Andy Bird, current chief executive of education publisher Pearson and his predecessor Omar Abbosh, who together earned almost £19 million. They relegated the FTSE 100’s highest-paid boss for the last two years, Pascal Soriot of pharma giant Astra Zeneca, into third spot, with a still tidy £14.7 million. The gender gap remains as strong as ever — the High Pay Centre survey discloses the median chief executive for the nine FTSE 100 companies run by a woman over the 12 months was £3.27 million, versus £4.64 million for those headed by a man.
The think tank is calling for low and middle earners to receive a greater share of the pot. It is also seeking reforms to regulations governing the pay-setting process followed by corporates, including full implementation of Labour’s employment rights bill. The proposed legislation requires that employers inform workers of their trade union rights, gives workers greater power to elect directors to company boards and introduces increased transparency regarding the reporting of pay. “The Government now needs to make sure these measures are implemented in full and supplemented by a real voice for elected worker directors in company boardrooms,” said Luke Hildyard, director of the High Pay Centre.
His plea and the report will be warmly received by many in Labour and add to pressure on Angela Rayner, who is driving the employment rights legislation, to push it through as soon as possible.
That will only stoke tensions with business and the City, still reeling from Rachel Reeves’s hike in employers’ national insurance and contemplating further tax-raising in her next Budget, due in the autumn. It will fuel the feeling, too, that Labour sees the wealthy as fair game, and as the best route towards closing the yawning £50 billion gap in the public finances.
See also: The taxwoman cometh... with her sights set on London
But it does so at a price. Evidence persists of some non-doms, targeted by Reeves, and members of the domestic rich, choosing to leave for more accommodating tax regimes, removing their spending and investment power. More are bound to follow if Labour continues down this path. At the same time, the Government claims to be pursuing “further and faster” economic growth, with AI and tech vital components in that charge.
There is a real danger of London getting left behind as the result of political ideology
There is a real danger of London getting left behind as the result of political ideology. US vice-president JD Vance, this summer’s highest-profile UK holidaymaker, has criticised Europe for adopting a regulatory approach, stating that “excessive regulation of the AI sector could kill a transformative industry”. He said: “We need international regulatory regimes that foster the creation of AI technology rather than strangle it, and we need our European friends, in particular, to look to this new frontier with optimism rather than trepidation.”
In America, it is all systems go and that means recruiting the brightest and best and paying whatever it takes. How long before our finest brains join the gravy train? We’re keen to be world leaders in the development of AI and tech but that means getting real. Our unworldliness could prove to be our undoing. It is no good saying we want AI and tech if we are not prepared to pay for them.
