2020 Was A Brutal Year For Real Estate Pay — Especially If You Aren't White
The effects of the coronavirus pandemic on real estate pay have been laid bare by new data that shows salaries were mostly either flat or declined, bonuses dropped sharply and a significant proportion of those working in the sector lost their jobs, especially if they weren't White.
The annual Macdonald & Co. and RICS Rewards and Attitudes Survey polls more than 7,500 real estate professionals, about two-thirds of them in the UK and the rest spread across the Middle East, Asia and Europe.
It found that 11% of those surveyed across the globe lost their jobs in 2020, a further 18% saw their base salary decrease and 58% said base salary was flat. In 2019, only 3% saw pay decrease and 41% got a pay rise, the survey found, and there was essentially 0% unemployment.
Unemployment disproportionately affected young and non-White real estate professionals. On a global basis, those in the 18-26 age bracket were the most likely to have lost their jobs, with 20% saying they became unemployed.
When looking at the UK, 14.6% of respondents who identified as Black, Asian or minority ethnic reported losing their jobs as a result of COVID-19, almost two-thirds more than the 8.9% of White respondents who became unemployed.
The survey collected data for the first time on the ethnicity pay gap in the UK, and found that the median salary of Black, Asian and minority ethnic real estate professionals was 20% lower than their White counterparts. The disparity was mainly down to the fact that financial rewards including bonus/commission, pension and professional membership fees were 26% lower for non-White workers.
Female professionals in the UK also fared worse than their male counterparts, albeit not by as great a margin, with 10.1% of women become unemployed compared to 8.6% of men.
The pandemic is widely perceived as having had a detrimental impact on gender equality in the workplace, and data from the survey bears this out. Macdonald and the RICS have been tracking the gender pay gap among those they survey since 2013. The gap was essentially static until 2019 when it narrowed to 17%, but in 2020 it expanded to 27%, the widest since data collection started.
While young professionals were more likely to lose their jobs, the older you were, the more likely you were to have faced a pay cut, with senior staff bearing the brunt of salary decreases: 23% of those aged over 65 received a base salary decrease.
Bonuses, a big part of the remuneration package in many sectors of real estate, saw massive cuts. Of those surveyed, 35% didn’t receive a bonus, while 27% saw their bonus decrease, meaning this part of compensation decreased for almost two-thirds of the industry.
In terms of base salary, there is a strong correlation between how well a sector is performing and how well it pays. Self-storage, build-to-rent and logistics topped the charts, with median base salaries in all three surpassing £60K in the UK. A slight anomaly is that retail is not far behind with £58K.
Those in the residential block management sector were by far the most likely in the UK to have been awarded a pay rise, perhaps unsurprising given how their workload has increased now that a wide swathe of the population works from home the whole time.
The survey found that there have been changes in attitudes alongside changes in remuneration. Of those surveyed, 17% said they might consider leaving the industry altogether in the next 12 months, while 24% said they would consider switching sectors to find work in a more profitable area of real estate. About 10% said they would consider returning to their studies to get more qualifications.
But the report also found that now more than ever, money isn’t everything. For the first time in the survey’s 21-year history, salary wasn’t the thing real estate professionals valued most at work — it was knocked off the top spot by work-life balance. When asked if they would rather be able to work more flexibly or have a 5% pay rise, 70% picked flexible working, compared to just 40% the year before.