Partner Article

Pay increases fall by 0.2 percent

The median pay increase fell 0.2 percent in the last quarter to two percent according to new research.

This figure has been attributed to weaknesses in the labour market, as well as the squeeze on real incomes. While the Monetary Policy Committee found little evidence to suggest that inflation rates were feeding through to wages, XpertHR found that 80 percent of employers used a measure of inflation to guide levels of pay awards.

XpertHR pay and benefits expert Sheila Attwood commented: “The fragile job market, combined with consumption and demand continuing to be affected by factors including rising food and oil prices, means that we expect no significant, if any, increase in median pay awards for the rest of the summer.”

However, its important to note that this is the quieter end of the pay bargaining year, which tends to be bunched around January and April. During these two months alone, 60 percent of pay awards are concluded, in comparison with less than 25 percent between July and December.

While some employers will be obliged to award their lowest paid workers a 2.5 percent increase in October 2011 to comply with the National Minimum Wage, the majority of pay awards will continue to be at or below this level.

This was posted in Bdaily's Members' News section by Ruth Mitchell .