Workplace Report January 2015

Pay and prices

Settlements edge higher

Organised workers have seen some improvement in their living standards.

The latest figures from the LRD Payline database of collective agreements show that the median of settlements in the three months to December 2014 was 2.6%, up from the revised figure to November of 2.5%. With Retail Prices Index (RPI) inflation in the year to December running at 1.6% settlements are running a full percentage point ahead of inflation.

The level of settlements varies little by sector with the private sector median for the three months being 2.6% and the public sector 2.7%, manufacturing settlements had a median of 2.5% and services 2.6%. The median for the pay round to date was 2.4% and for the year to December it was 2.5% by agreement and just 2.1% when weighted by workers covered.

The median figures from the other two pay analysts (Incomes Data Services, XpertHR) are for 2.0% rises. As both of them include settlements from the unorganised workplaces, Payline’s figures would seem to suggest that union organisation is helping some workers to a much better settlement.

The latest government statistics on Average Weekly Earnings show that in the year to November total pay including bonuses rose by 1.8%, down from the 2.0% recorded for the year to October.

Forecasts for inflation in the fourth quarter of 2015 averaged 2.1% from independent forecasters, with new forecasts averaging 1.9%. The range of forecasts was from 0.2% up to 3.6%.