Settlements post 3.0% rise

Pay settlements averaged 3.0% in the three months to December according to the latest figures from Labour Research Department’s Payline database. This is an increase on median (midpoint) of 2.1% for both November and December.

The private sector saw its median increase to 3.0%. The figure for manufacturing edged up 2.7% from 2.5%, but for services it was up by over a percentage point to 3.2% from 2.0%.

The annual medians were 2.5% by agreement, but 3.1% when weighted by the number of workers covered.

Inflation, as measured by the Retail Prices Index (RPI), was rising at 3.3% in the year to January against 3.1% at the end of 2012. RPI excluding mortgage interest payments (RPIX), also posted a rise from 3.0% to 3.3%. And the government’s preferred measure of inflation, the Consumer Prices Index (CPI), was unchanged at 2.7% for the third consecutive month.

The latest statistics on Average Weekly Earnings show that total pay, including bonuses, rose by 1.4% in the year to December, unchanged from November. Average pay rose by 1.2% in the private sector, but in the public sector the increase was 2.2% (and 2.3% if the nationalised banks are excluded). In manufacturing the increase was 1.7% and in services 1.6%.

If bonuses are excluded the increases in December were 1.3% for the whole economy and the private sector, 1.9% in the public sector, 2.1% in manufacturing and 1.4% in services.