Soaring staff costs are outstripping increases in revenue and causing profits to nosedive, figures from two leading firms appear to show.
Annual accounts for international firms CMS and Trowers & Hamlins – both published in the past week – show that staff costs have risen at more than double the rate of increase in turnover.
The figures suggest that inflationary pressures and firms having to hike salaries to match the cost of living may be supressing profits.
At top-10 firm CMS, turnover was up 6.7% to £688m in the year to 30 April 2023, while staff and related costs rose 12.7% to almost £300m. Profit before tax and members’ remuneration and profit shares fell 6% to £225m. Source