Why are salaries in consulting so much lower in London?

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JPillows
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Hey Guys,

I was looking at the management consulting salaries in the US and it seems that the salaries in the UK are lacking quite a fair bit from our American counterparts.

http://managementconsulted.com/consu...e-mba-interns/

The big 4 in London starts at around 32k and the pure consulting firms slightly more. It is quite ridiculous how much the pay disparity can be when the cost of living in London is the highest in the world.
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camaieu
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(Original post by JPillows)
Hey Guys,

I was looking at the management consulting salaries in the US and it seems that the salaries in the UK are lacking quite a fair bit from our American counterparts.

http://managementconsulted.com/consu...e-mba-interns/

The big 4 in London starts at around 32k and the pure consulting firms slightly more. It is quite ridiculous how much the pay disparity can be when the cost of living in London is the highest in the world.
If you graduate from uni and walk into a 32k job, you're doing quite alright.

I get the frustration about the pay disparity; and I'm afraid that I can't really help you out there. Perhaps it's more a case of American salaries being grossly puffed-up, as opposed to paltry UK counterparts? Idk.

All I know is that a starting salary of 32k is not to be sniffed at.
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JPillows
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(Original post by camaieu)
If you graduate from uni and walk into a 32k job, you're doing quite alright.

I get the frustration about the pay disparity; and I'm afraid that I can't really help you out there. Perhaps it's more a case of American salaries being grossly puffed-up, as opposed to paltry UK counterparts? Idk.

All I know is that a starting salary of 32k is not to be sniffed at.
32k is definitely a good salary. However, IB and American law firms do pay quite similarly to our New York counterparts. It is only in consulting that such a wide disparity exist.

Why I found the report egregious was that the cost of living in London would rival any major city in the world, so it is quite ludicrous to have such a large difference in starting salary.
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Potally_Tissed
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(Original post by JPillows)
Hey Guys,

I was looking at the management consulting salaries in the US and it seems that the salaries in the UK are lacking quite a fair bit from our American counterparts.

http://managementconsulted.com/consu...e-mba-interns/

The big 4 in London starts at around 32k and the pure consulting firms slightly more. It is quite ridiculous how much the pay disparity can be when the cost of living in London is the highest in the world.
Two minutes of googling would show you that London is not in fact the most expensive city in the world to live in. That accolade goes to Singapore, and I'm pretty sure New York is higher than London as well.

There are also a few other disadvantages to working in the US, like the lack of any statutory right to paid holiday and a normal amount offered being 10 days per year vs ~25 in London.

And as above, 32k straight out of uni isn't exactly bad.
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JPillows
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(Original post by Potally_Tissed)
Two minutes of googling would show you that London is not in fact the most expensive city in the world to live in. That accolade goes to Singapore, and I'm pretty sure New York is higher than London as well.

There are also a few other disadvantages to working in the US, like the lack of any statutory right to paid holiday and a normal amount offered being 10 days per year vs ~25 in London.

And as above, 32k straight out of uni isn't exactly bad.
Well lets agree to disagree, there are a few surveys that point to London, a few to other cities, one of which is Singapore. I think reasonably, we can both agree that cost of living in London and New York are both pretty similar.

I agree with what you are saying about the disadvantages. But as I have stated previously, the IBs and the American law firms are paying similarly to what they do in NY. My real question is why do consulting salaries lack behind when the other highly regarded professions do not.

Cheers
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Mathlover123
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It may partly be due to over-saturation, All the businesses are here in London and 1000s of grads want to go to every place, companies don't need to attract people if theres a job people want it. In the US and in other places its not anywhere near as congested in terms of Grads the wages have to be enough that someone would be willing to move for it.
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JPillows
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(Original post by Mathlover123)
It may partly be due to over-saturation, All the businesses are here in London and 1000s of grads want to go to every place, companies don't need to attract people if theres a job people want it. In the US and in other places its not anywhere near as congested in terms of Grads the wages have to be enough that someone would be willing to move for it.
I agree to your point that companies do not need to pay nearly as much to attract the same talents. That is probably the reality of the situation. It is just gutting that the other similarly respected industries do pay quite similarly to the US, while consulting lacks so far behind.
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Bill_Gates
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32k for London is not great, 1k = rent.
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Potally_Tissed
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(Original post by Bill_Gates)
32k for London is not great, 1k = rent.
You can get something perfectly decent for £800 ish, unless you're desperate to live by yourself, in which case it's likely going to be even more than £1000. But surely that can wait a year or two until you're earning more.
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JPillows
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(Original post by Bill_Gates)
32k for London is not great, 1k = rent.
Lol haha. This is precisely why I found the 20kusd difference so upsetting. That would be a year worth of rent.
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Bill_Gates
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(Original post by Potally_Tissed)
You can get something perfectly decent for £800 ish, unless you're desperate to live by yourself, in which case it's likely going to be even more than £1000. But surely that can wait a year or two until you're earning more.
(Original post by JPillows)
Lol haha. This is precisely why I found the 20kusd difference so upsetting. That would be a year worth of rent.
Honestly someone who has been to London you really need to spend that 1k to get a decent place. I know you can get it for cheaper but i'd rather spend the extra and get somewhere safe.

32k after tax is like £2000 per month - £1000 gone in rent then you have all the extras not much left at all. However if it's a career you REALLY want to do, then why not.
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Mathlover123
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(Original post by Bill_Gates)
Honestly someone who has been to London you really need to spend that 1k to get a decent place. I know you can get it for cheaper but i'd rather spend the extra and get somewhere safe.

32k after tax is like £2000 per month - £1000 gone in rent then you have all the extras not much left at all. However if it's a career you REALLY want to do, then why not.
Its not great but it is a livable amount, the min you need in London is about 20-25k any less than that and you will probably be just gaining debt. However the best bet is to have flatmates in a place and you can get £600 rent probably wont get any cheaper than that, if you go further out you might but then have to +£100 for travel.
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Bill_Gates
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(Original post by Mathlover123)
Its not great but it is a livable amount, the min you need in London is about 20-25k any less than that and you will probably be just gaining debt. However the best bet is to have flatmates in a place and you can get £600 rent probably wont get any cheaper than that, if you go further out you might but then have to +£100 for travel.
Yeah but like i said i'd rather live somewhere decent. Flat sharing is not great in terms of noise/cleanliness etc lol. But £800 is really the MINIMUM but why not spend that extra £200 and get somewhere safe and sound! I know some of my mates (Journalists) living in london on 16k per year but the conditions are not great!
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Potally_Tissed
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(Original post by Bill_Gates)
Honestly someone who has been to London you really need to spend that 1k to get a decent place. I know you can get it for cheaper but i'd rather spend the extra and get somewhere safe.

32k after tax is like £2000 per month - £1000 gone in rent then you have all the extras not much left at all. However if it's a career you REALLY want to do, then why not.
I've lived and worked in London since I graduated two years ago, I really wouldn't say you need to spend a grand to get something decent. The area I'm in is definitely not "unsafe" and the going rate for a room in a new build flat is more like £850. £1000 is excessive. I'm not going to claim it's the nicest part of the city but you definitely don't need to spend an extra 10% of your net income for somewhere more up market.

If you really want to spend more then maybe wait a bit until you earn more. 50% of your net salary on rent is pushing it.
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Bill_Gates
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(Original post by Potally_Tissed)
I've lived and worked in London since I graduated two years ago, I really wouldn't say you need to spend a grand to get something decent. The area I'm in is definitely not "unsafe" and the going rate for a room in a new build flat is more like £850. £1000 is excessive. I'm not going to claim it's the nicest part of the city but you definitely don't need to spend an extra 10% of your net income for somewhere more up market.

If you really want to spend more then maybe wait a bit until you earn more. 50% of your net salary on rent is pushing it.
Yeah that's the thing i would want that up market area lol. 50% of your salary is nothing new for London, even for the average UK family it is 33% of total expenditure (most likely with 2 people working).
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Sarky
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(Original post by Bill_Gates)
Yeah but like i said i'd rather live somewhere decent. Flat sharing is not great in terms of noise/cleanliness etc lol. But £800 is really the MINIMUM but why not spend that extra £200 and get somewhere safe and sound! I know some of my mates (Journalists) living in london on 16k per year but the conditions are not great!
What evidence are you basing that on? I have lived in London for nearly 30 years and rented a room in a really nice shared flat in Zone 1 for £740/month with all bills included. It was clean, it was safe.

Most young professionals in London flat share. They're not all being mugged or sexuallty assualted everytime they leave the house, or destined to a live of misery where they life. If you want to live alone by all means do but you're being slightly melodramatic.
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Bill_Gates
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(Original post by Sarky)
What evidence are you basing that on? I have lived in London for nearly 30 years and rented a room in a really nice shared flat in Zone 1 for £740/month with all bills included. It was clean, it was safe.

Most young professionals in London flat share. They're not all being mugged or sexuallty assualted everytime they leave the house, or destined to a live of misery where they life. If you want to live alone by all means do but you're being slightly melodramatic.
Once again we get to the flat share issue.

1. I do not want to share a house!
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scrotgrot
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(Original post by Bill_Gates)
Honestly someone who has been to London you really need to spend that 1k to get a decent place. I know you can get it for cheaper but i'd rather spend the extra and get somewhere safe.

32k after tax is like £2000 per month - £1000 gone in rent then you have all the extras not much left at all. However if it's a career you REALLY want to do, then why not.
So what, with consulting you will be on double that within a few years
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scrotgrot
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(Original post by Bill_Gates)
Yeah but like i said i'd rather live somewhere decent. Flat sharing is not great in terms of noise/cleanliness etc lol. But £800 is really the MINIMUM but why not spend that extra £200 and get somewhere safe and sound! I know some of my mates (Journalists) living in london on 16k per year but the conditions are not great!
How about the social side of it? Moving to a new city it would be great to have a few people to talk to, keep you sane and give you the beginnings of a social circle. I certainly would if only for the first year.
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Sarky
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(Original post by Bill_Gates)
Once again we get to the flat share issue.

1. I do not want to share a house!
Then you'll just have to suck it up buttercup!
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