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Thursday 29 September 2016
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Pay rises remain below inflation rate

Workers are still receiving pay rises that are well below the current rate of inflation, figures have suggested.

Median pay rises remained at 2.5% in the quarter to March, according to pay analysts Incomes Data Services (IDS).

The group's figures show that almost two out of three deals during the period were between 2% and 3%, compared with a current RPI inflation rate of 5.3%.

Employees in the private sector continued to enjoy higher levels of pay awards than workers elsewhere, at 2.9% compared with 2.5% for the manufacturing and production sectors.

The group studied almost 100 settlements awarded to just under 400,000 employees.

The figures suggest a balance between upward and downward pressures on pay, with median pay settlements remaining at 2.5% for each of the last three rolling three-month periods.

IDS said that, alongside high inflation, the recovering profitability of firms also provided an upward pressure on pay settlements.

Ken Mulkearn, of IDS, said: "Our pay settlement figures show overall stability, with some evidence of modest upward pressures coming through from the initial data on April awards.

"The various pressures on pay are finely balanced, with higher inflation being offset to some extent by employers' concerns about the economic recovery and the impact of public sector job cuts on the labour market."

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Incomes Data Services