COMPANIES across the region are struggling to hold on to executives, despite a rise in bonus payments.

A survey by the Chartered Management Institute and Remuneration Economics found that 79.9 per cent of North-East executives received a bonus in 2004, the fourth highest average in the country.

But in spite of this, the region has its worst retention rate for 15 years, with 45.4 per cent of companies reporting problems.

Nearly 62 per cent blamed competition from other organisations and 45.4 per cent admitted they offered little in the way of career progression or training.

More than 43 per cent said they had experienced recruitment difficulties, up from 30.9p last year.

More than two thirds put this down to a lack of candidates with specialised skills, especially those in IT management, engineering and sales.

Mary Chapman, chief executive of the Chartered Management Institute, said: "The reported shortage of managers and staff with relevant skills is a concern because competitive advantage can be threatened if employees lack the ability to carry out their roles.

"Worse still, many organisations admit that they fail to provide adequate development initiatives."