Are commission-earning agents better off?

MANAGEMENT theory is
that variable pay must
constitute at least 20%
of a person’s pay to be taken
seriously by earners.
In the travel industry the
portion of salary at risk for
those on commission is on
average two to three times that
percentage depending upon
location.
The Amadeus-sponsored
survey was conducted by TNW
in March. The following average
earnings are for all respondents
who said they worked in a
travel agency. This includes
management whether they did
consulting as well or not.
The number of trade
professionals who responded
to the survey was 981. Of
those, 772 said they worked
in a travel agency. In statistical
terms that means that one
can have 95% confidence that
the results are within 5% of
accuracy.
In the last report we showed
that 62% of travel consultants
not in management did not
earn commission.
The graph (right) shows that
of the people who work in
a travel agency and do earn
commission, those in KZN
earn more commission and are
more dependent upon it than
consultants in the other main
provinces.
In Gauteng the commission
portion of total earnings is
40%, in the Western Cape it is
44% and In KZN it is 53%.
When combining commission
and basic pay, the average
consultant in KZN earns
R17 605. Gauteng consultants
earn 16% more at R20 495
and Cape agents are the
highest earners with 18% more
at R20 792.
So is commission a good
thing? Is the risk to
earnings justified? This would
appear to be the case in KZN
where commission-earning
travel agents earn 27% more
than their colleagues who
don’t. In Gauteng and Western
Cape, the advantage enjoyed by
commission earners is 6%