Whilst average salaries slip to a new four year low, HR tops the league table taking home the highest pay increase of all sectors at 5.9 per cent.

These are the findings of the Chartered Management Institute and Remuneration Economics that conducted a survey of over 42,000 people. The 2007 National Management Salary Survey shows an increase in earnings of 5.3 per cent, a figure that is down from the 2006 level of 5.7 per cent. On the lowest end of the pay rise scale are workers in the transport and logistics sector taking home a 2.6 per cent increase whilst workers in HR enjoyed the biggest increase.

Managers take home an average £47,449 according to the survey authors, who say managers in the capital enjoy the most, at £54,808. Bonus payments are also down. In 2007 59.2 per cent of executives were awarded bonuses, representing a drop for the second consecutive year.

Regional differences also play a part – whilst workers in London enjoy an average bonus payment of £8,887, those in the South East are awarded just £3,171 on top of their annual salary.

Despite the fall in earnings, the number of organisations providing a complete remuneration package is climbing. Childcare voucher provision is up to 70 per cent (from 67 per cent, last year) and life assurance is offered by 57 per cent of employers (up from 52 per cent).

Paul Campfield, director at Remuneration Economics said: “This year’s survey shows how benefits packages are increasingly being offered to employees amongst all levels of seniority. When reporting first began, in 1974, provision of medical insurance was largely the domain of directors. Today, over 70 per cent offer the same benefit to staff across the organisation.”

Bosses are also reporting renewed struggles with attraction and retention. Resignation levels have also increased standing at 7 per cent, compared to 4.6 per cent last year.

According to the report, a huge 81 per cent of employers are having problems with finding the best staff. Employers are turning to financial tactics to lure staff, 32.6 per cent now offer ‘golden hellos’, compared to just 16.3 per cent in 2006. Eighty two per cent also indicate that they will make ‘referral payments’ to staff, up from 62.5 per cent, last year.

The majority of employers blamed a lack of qualified candidates for their recruitment problems.