Settlements move with inflation

The latest figures from LRD's Payline database show settlements moving up to 3.5% for the three months to January - broadly in line with the Retail Prices Index (RPI), which rose to 3.5% in December.

Figures from other pay analysts moved in the same direction: Industrial Relations Services quoted a median of 3.3%, and Incomes Data Services 3.2%.

The main variation within our figures is the gap between private sector settlements (at 3.5%) and the public sector (3.0%). Settlements in manufacturing had a median of 3.3%, slightly below the 3.5% in services. The annual figures again show that settlement levels are higher among larger bargaining groups.

Inflation

The all-items RPI has fallen to 3.2% in the year to January, from the December figure of 3.5%. The RPI excluding mortgage interest payments (RPIX) is also lower at 2.1%, compared with December's 2.5%.

The only measure of inflation to be unchanged is the government's favourite, the Consumer Prices Index (CPI), which remained at 1.6% in the year to January.

Earnings

The latest average earnings figures from National Statistics shows that earnings across the whole economy rose by 4.4% in the year to December. The only variation was between manufacturing (with an average rise of 3.8%) and services (4.5%). The average increase across both the public and private sectors was 4.4%.