UK pay awards rise in Q1 but April hints at softness, Brightmine says

BRITISH employers offered slightly higher pay deals in the first quarter of 2026 but early signs of softness emerged in April, a key month for wage settlements, a survey from human resources data publisher Brightmine showed on Wednesday.

The Bank of England is watching pay awards as it gauges inflation pressure in Britain’s economy, which investors view as more vulnerable than its peers to higher energy prices caused by the war in Iran.

Official data on Tuesday showed average weekly earnings cooled by less than expected in the three months to February, but other measures such as vacancies and payrolls pointed to a softer labour market in March, after the start of the war.

Brightmine said the median pay deal was 3.5 per cent in the three months to March, up from 3.3 per cent in the previous two rolling quarters.

Initial analysis pointed to a median pay award of 3 per cent for April, when almost half of wage settlements take place each year, with the uncertain economic outlook and increases in the minimum wage and other costs making employers cautious.

“While increases remain broadly in line with expectations, there is little evidence of upward pressure building,” said Sheila Attwood, senior content manager of data and HR insights at Brightmine.

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Brightmine based its reading for the first quarter on 111 pay deals, representing settlements for 373,000 employees. REUTERS