UK pay awards hold at lowest in nearly four years: IDR survey
[LONDON] Pay settlements awarded by British employers held steady in the three months to September, according to a survey published a day before the Bank of England’s interest rates decision.
Incomes Data Research said on Wednesday that the median pay rise awarded by major employers was 3 per cent in the July to September period, holding at the joint lowest level since December 2021.
But the IDR said more than a third of pay settlements increased to 4 per cent in the three months to September. It attributed the rise to a bigger proportion of pay rises in the manufacturing and the public sectors.
Median pay awards for the public sector averaged 4 per cent.
“The differing outcomes in the private and public sectors suggest the public sector is currently in the ‘catching-up’ phase, after a lengthy period in which pay awards lagged behind those in the private sector,” Zoe Woolacott, a senior researcher at IDR, said.
Official figures showed a slowdown in British pay growth in the three months to August while inflation held steady at 3.8 per cent in September, despite the BoE expecting a rise to 4 per cent.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
BoE Governor Andrew Bailey has said the figures backed his view that inflation pressures in the economy were easing.
The central bank, which is closely monitoring wage growth, is likely to keep interest rates at 4 per cent on Thursday. It expects private-sector pay growth of 3.75 per cent by the end of this year.
A survey published last week also showed employers, concerned about the impact of high inflation and last year’s rise in social security contributions implemented by finance minister Rachel Reeves, were planning pay awards of 3 per cent.
She is due to present the government’s annual budget on Nov 26, which is widely expected to include further tax rises.
IDR’s survey covered 35 pay deals for nearly 800,000 employees between July 1 and Sep 30. REUTERS
Share with us your feedback on BT's products and services
