Partner Article

2012 Public Sector pay increases just 2%

Private sector employees are set to see pay rises of just 2% in the year to 28 February 2013, as the slow recovery continues to hit many organisations.

More than 75% of all respondents to the XpertHR survey said that they are planning to award a pay rise on the normal review date, but a tenth of businesses can expect to see their wages frozen.

Most organisations anticipate award rises worth between 2% and 3%, and a mere 9.9% of organisations expect to give an annual award worth more than 2012’s RPI forecast of 3.2%.

While many employees are struggling with the financial squeeze, most bosses do not feel the need to compensate for several years of low pay rises. Only 16.6% feel obliged to make up for previous low rewards.

XpertHR Pay and Benefits editor Sheila Attwood said: “Although we might expect employees to be tiring of low pay rises or pay freezes, our survey respondents indicate that to date they have understood about the economic challenges that organisations face.

“However, a median 2% increase during 2012 will result in another of year of below-inflation pay rises.”

The figure from our pay forecast survey is lower than our current median pay award of 2.6% for the three months to 29 February 2012, but organisations may be wary of committing to higher pay rises and some feel burdened by pension changes.

Additionally, the not-for-profit sector, which tends to take its lead from the public sector in terms of pay awards, accounts for more than one-fifth of respondents to this survey.

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