Settlements fall further behind prices

The latest figures from the LRD Payline database of collective agreements show the overall median pay increase unchanged at 3.0% for the three months to October.

This median applies across all sectors and occupational groups - the slightly higher level of settlements seen in the private sector in recent months has now levelled off - and is the same both for the latest three months and for the whole of the last year.

Other pay analysts agree with the LRD figures.

Inflation

The retail prices index (RPI) rose again in the year to October, to 3.7% from the September figure of 3.6%. The RPI excluding mortgage interest payments (RPIX) remained unchanged at 3.2%.

The consumer prices index (CPI) - the government's preferred measure of inflation, which does not include housing costs - was also unchanged at 2.4%.

Inflation forecasters are anticipating falls in both the RPI and the RPIX by this time next year.

Earnings

The Average Earnings Index rose by 4.1% in the year to September, although as usual there were marked variations by sector. The private sector's average increase of 4.2% far outstripped the 3.3% average in the public sector, and earnings growth in the service sector lagged far behind that in manufacturing (4.1% compared with 5.5%).