Custody: Rising pay threatens to drive jobs overseas

Sheer demand for asset administration staff is, not surprisingly, creating pressure for pay to rise.

In Dublin, asset administrators can achieve a 10% to 20% increase in salaries when moving jobs, according to Mia Barry, a director at the local office of recruitment firm Robert Walters. Fund administrators with three years' experience in the city can expect to earn between €33,000 and €35,000, she says. Other Dublin recruiters say job changers are being offered upfront payments of a month's salary as an inducement to move.

Rising pay in Dublin is helping narrow the gap with salaries in Luxembourg, where salaries for fund administrators are among the highest in Europe and income taxes are among the lowest. A Luxembourg fund administrator with three years' experience can command €38,000 - €45,000, says Annie Burton in the Luxembourg office of recruitment firm Badenoch & Clark.

London pay is higher still, with similarly qualified staff commanding 30,000 to 45,000 according to recruiter Badenoch & Clark, while New York's junior asset administrators can expect $50,000 to $75,000 according to recruiter Drum Associates.

In Edinburgh and Italy, by comparison, pay is low. From 20,000 to 24,000 is the norm in Scotland's financial capital, says recruitment firm Joslin Rowe, while Maximilian Redolfi at Michael Page in Milan says Italian pay is 20% lower than that of Luxembourg.

Low pay may yet prove to be a virtue, however. State Street chief executive Ron Logue was recently reported pontificating on the benefits of locating labour intensive asset administration operations in low cost Central and East European countries, while Badenoch & Clark says Asian custody hiring looks set to take off in 2006.

The booming market for custody jobs in Western Europe and the US may yet have the effect of driving vacancies overseas.