Newly-qualified accountants expect to earn 14% more this year than their counterparts in 2005, a survey shows.

According to more than 300 commerce and public firms surveyed by financial recruitment specialist ECHM, the phenomenon of ‘buy backs’ is becoming rife. This refers to employers having to ‘buy back’ employees with pay rises before they have left.

Newly-qualified members of the Association of Chartered Certified Accountants can now earn a basic salary of £43,000. This is expected to rise to £45,000 by 2007, representing a 22% increase between 2005 and 2007.

Newly-qualified Associate Chartered Accountants within commerce and public practice can now earn up to £48,000 compared to £45,000 last year. Their basic pay is expected to rise to £52,000 in 2007, an increase of 16% in two years.

This salary growth is a result of an increasingly candidate-short market compounded by high levels of demand.

John Hunter, ECHM chief executive, says: “Accountancy firms are working hard to retain key talent within their businesses and we have started to see a growing trend in ‘buy backs’, particularly at the newly-qualified level. This is not a tactic that practice firms have previously utilised and is indicative of the tightness of the talent pool.”