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Accounting Industry Updates – March 2023

Accounting Industry Updates – March 2023

Accounting Industry Updates – March 2023

The financial services industry is gearing up for bonus season. Following a prosperous year for some, and a challenging one for others, bonus ranges will be predominately sector driven, varying from business to business. As a result, we expect to see natural attrition in the market of qualified professionals, if they’re not satisfied with their bonus payment.

2022 was a steady year in terms of overall performance for the insurance sector, though there have been some local outliers that have been negatively impacted by Covid. Climate change has also had a massive effect on insurance companies, which will in turn affect bonus payments. However, it is expected that generally speaking, bonuses in the insurance sector will be on target.

There was massive turmoil in 2022 within the global markets, impacting the Asset and Wealth Management Sector. In particular, Equities suffered a huge decline, leading to its worst performance in years. This in turn had a huge impact on potential bonus payments for equity-focused managers. Locally in Ireland, we anticipate bonuses will remain steady but will not exceed targets in place as a result.

The Irish Banking sector went through a radical change in 2022 with the announcement following the imminent move of Ulster Bank from the market. This has created an opportunity for the pillar banks to grow. Pillar banks moving to be privatised will give an advantage to Irish banks in the coming years and they will be able to start paying bonuses again in the coming years. In the short term, bonuses in Irish pillar banks will ultimately be similar to previous years with little to no bonus being paid out.

Finally, within the Aircraft Leasing sector, there has been a huge rebound in commercial travel post-Covid. The only impact felt by aircraft leasing companies are those with Russian assets on their portfolios, however, this sector performed well in 2022 overall. While bonuses are projected to be in line with expectations this year, challenges are expected in 2023 due to rising interest rates and a lack of investment.

Addressing the cost-of-living crisis

With the rising cost of living in Dublin and Ireland, several companies are contemplating cost of living equivalent pay increases, which are estimated to be between 4-7% of base pay. If companies do decide to implement cost of living relative pay rises, you must be be transparent with your employees about the rationale behind the decision, and how it will be calculated. This will help build trust and confidence with your employees. It’s important to monitor and review the impact of cost-of-living relative pay rises over time, which will help determine if the measure is achieving its intended goals or if adjustments need to be made.

What can companies do in lieu of bonus payments?

If companies aren’t in a position to allocate bonuses, they should look to offer non-monetary incentives like flexible working hours, opportunities for professional development and training, or an enjoyable company culture that fosters teamwork and collaboration. Companies can also develop a retention strategy that outlines specific steps to retain employees. This strategy can include regular check-ins with employees and creating a culture of appreciation. By implementing these strategies, companies can create a work environment that fosters engagement, career growth, and a sense of community, which can mitigate the risk of employees leaving after receiving their bonus.

If you are interested in learning more about live opportunities, or you would like to discuss how we can support your hiring processes in the current market, please get in touch with Mark Fallon, Co-Founder and Director for Accounting.

William McCoppin


William has experience across multiple markets, specialising in compliance and financial crime at the interim, mid-to-senior and executive level.