Pay Squeeze Leaves Junior Staff Unwilling to Train New Hires, New IRIS Software Group Research Finds

• Seven in ten (71%) employees with two to five years' experience say a shrinking pay gap makes it hard to feel motivated to train new hires despite a third being expected to do exactly that
• Experienced junior staff and new starters are separated by just £650 a year in salary with nearly half (46%) of HR leaders expecting it to narrow further
• 84% of HR leaders fear losing staff as a result, yet only one in five organisations plan to adjust pay to address the problem
• Nearly a quarter (23%) of HR leaders use tech solutions unable to compare pay changes to employee responsibilities, hindering visibility into pay compression

LONDON, Sept. 4, 2026 /PRNewswire/ -- Young professionals are becoming reluctant to train new hires as rising entry-level pay narrows the gap between new starters and employees with more experience, new research from HR software and services specialist IRIS Software Group reveals*.

Seven in 10 (71%) young professionals – employees with two to five years' experience* – told IRIS they find it difficult to feel motivated to train or help a new starter earning almost as much as them.

The same study panelled the views of 500 HR leaders*, with a third (32%) admitting that the gap between young professionals and entry level recruits has narrowed over the last two years. Of those, HR professionals blamed pay compression on factors including rises to the national minimum and living wages, and prioritising attractive starter salaries over pay rises for existing staff.

IRIS' study suggested little sign that pay compression would ease, with almost half (46%) of HR leaders polled expecting salary bands to narrow further over the next two years.

In instances where young professionals have discovered what a new starter earns, a quarter (24%) said it was the same as their salary, 38% said it was up to £1,000 less, and only 16% said it was between £1,000 and £3,000 less. Around one in six (16%) said they'd discovered new starters were being paid more than they were.

Across the study, the average pay gap between young professionals and entry-level staff stood at just £650 a year. Among young professionals who learnt what new starters were earning, 69% said it left them feeling undervalued, frustrated or disappointed. Some were motivated to take action, with around one in six (16%) accepting a new job offer, and a third (33%) asking for a pay rise.

The issue is worrying 84% of HR bosses, who are concerned about losing young professionals that feel their pay does not reflect their additional responsibilities and experience when compared to new recruits. However, only one in five (20%) HR leaders told IRIS they plan to make targeted salary adjustments.

Stephanie Coward, Managing Director for HCM at IRIS, said: "It's not surprising to see frustration building when young professionals are taking on harder work, more responsibility and helping train the next intake, but see almost no difference in their pay.

"Businesses have faced genuine pressure to raise starting salaries, including increases to the National Minimum Wage and National Living Wage. But this isn't only being driven by forces outside employers' control. HR professionals also pointed to internal issues such as salary bands not being reviewed regularly enough."

Compounding the problem, almost a quarter (23%) of HR leaders said their current HR systems are not capable of comparing pay against changes in employees' skills and responsibilities – making it harder to identify where pay compression is emerging and which employees are most affected.

Stephanie continued: "Most businesses won't be able to solve this with blanket pay rises. But they do need to understand where compression is happening and where it risks costing them good people.

"A targeted salary increase may look expensive, but so is losing an experienced employee, recruiting their replacement and rebuilding the knowledge that walks out of the door with them."

IRIS advised that the first challenge is seeing the problem clearly, saying if employers can't track how pay is moving alongside skills, experience and responsibility, they risk discovering pay compression only when someone asks for a rise or hands in their notice.

Stephanie concluded: "Better visibility gives businesses the chance to intervene earlier – whether that means targeted pay adjustments, clearer progression or simply having a more informed conversation with employees about what their experience is worth. The businesses that get ahead of this aren't the ones reacting to resignations – they're the ones treating pay data as a strategic tool, not just a payroll function, so they can see where the ladder is breaking down before their best people do."

*The research was conducted by Censuswide on behalf of IRIS Software Group, among a sample of 511 UK senior HR professionals and 500 UK employees who have been in full-time work for between two and five years. The data was collected between 30.07.2026 - 05.08.2026.

About IRIS Software Group

IRIS Software Group provides intelligent software for accounting, HR, payroll and education. Supporting organisations where the work has to work, IRIS helps customers run essential, compliance-grade systems with confidence. Trusted by over 800,000 organisations across 135 countries, IRIS brings nearly 50 years of innovation and deep domain expertise together with data and AI to help customers work smarter, spot what matters, reduce risk and move forward with confidence to grow.

For people and payroll teams, IRIS helps organisations support employees from hire to retire, pay people compliantly, accurately and on time, and build stronger businesses. Its software and flexible services connect HR, payroll, recruitment, talent and workforce information, helping teams reduce risk, improve employee experience and turn workforce data into clearer insight for better business decisions.

To see how IRIS helps organisations get things right first time, every time, visit www.iris.co.uk or follow IRIS Software Group on LinkedIn.