Inflation eats away at pay rises
Pay continues to be eroded by inflation. The latest figures from the Labour Research Department’s Payline database of collective agreements show that in the three months to February the median (midpoint) for all settlements was 3.0% — up from 2.7% in January. However, under the Retail Prices Index (RPI), the annual inflation rate was higher at 3.2%.
The Payline settlement figures vary by sector; private sector settlements had a median increase of 3.0% against 2.8% in January, but the public sector median was unchanged at 1.0%, reflecting the public sector pay freeze.
Settlements in both manufacturing and services were unchanged on January with median rises of 2.5% and 3.0% respectively.
Manufacturing
Pay pressures are remaining absent through the bargaining period for manufacturing companies who are keeping a tight hold of internal costs in the face of difficult economic conditions, according to the latest survey on pay data from EEF, the manufacturers’ organisation and JAM Recruitment.
According to their survey of over 200 companies the average settlement level for the three months to the end of February was 2.3%, the same figure for the previous three-month period to the end of January. Furthermore, almost 90% of settlements were agreed at 3% or less.
At the top end, there were 24 settlements worth at least 3.01%, including eight of over 4%.