Real pay levels in the West Midlands come in five per cent below the national average, according to new figures from management consultancy Hay Group.

The firm's new wealth map of the UK compares regional pay variations against local cost of living to find real pay levels. And it paints a diverse picture of UK purchasing

power, with employees in Scotland, Yorkshire and the North-east significantly better off than the rest of the country.

While high salaries in central London more than compensate for the high cost of living, salaries for employees in the South-East, South-West and East Anglia leave employees relatively out of pocket.

Salaries in the Midlands are struggling to keep pace.

"Employers around the country can no longer rely on old notions such the North-South divide when deciding pay levels," said Ben Frost, a consultant at Hay Group.

"Local economic conditions are varied and complex.

"Employers must take them into account if they are to attract the best talent with salaries that can provide genuine buying power in their region."

Topping the table alongside central London is Scotland, where a cost of living 5.5 per cent below UK levels makes salaries four per cent above the national average.

Graduate salaries are 2.5 per cent above the national average and senior management salaries a huge 12 per cent ahead.

Yorkshire's workforce also takes home above average pay.

"Contrary to stereotype, good salaries in Scotland and the North, combined with more reasonable costs of living, are affording northern employees the best standards of living in the country," Mr Frost added. Real pay across the Midlands is five per cent below the national average.

While recent inward investment and redevelopment in Birmingham and Nottingham has inflated house prices and cost of living, pay levels for the region have remained fairly static and do not adequately compensate regional employees.

In both the East and West Midlands, salaries below graduate level fall below the national average by eight per cent and seven per cent respectively.

East Midlands graduates can expect to earn three per cent below the national average, but their West Midlands counterparts are eight per cent adrift. ..SUPL: