The New Year bounce in pay awards is confirmed by the latest figures from pay specialists XpertHR. In the three months to the end of January 2014, the median pay award for UK employees was 2.4%. This is noticeably above the 2% increase recorded through most of 2013.
XpertHR’s figure, based on 115 pay settlements covering around 234,000 employees, is also above that recorded a year ago, when pay awards in the three months to the end of January 2013 stood at 2.2%.
However, our sample still contains a number of pay freezes, and only one in five awards (22.6%) are worth 3% or more. With RPI inflation at 2.8%, less than a quarter (24.3%) of pay awards match or exceed inflation.
Key findings for pay awards in the three months to the end of January 2014 include:
- The median pay award stands at 2.4%.
- The middle half of deals fall between 1.6% and 2.8%.
- More than one pay award in every eight (13.5%) is a pay freeze.
- Pay awards in the private sector were worth 2.4% at the median. The public sector continues to be covered by the average 1% pay award stipulated by government.
- Manufacturing and production employers record a higher median pay award (at 2.5%) than the services sector (2%).
XpertHR Pay and Benefits editor Sheila Attwood said:
"Over the past few years XpertHR has recorded an increase in the level of pay awards in the first few months of the year, only for this to fall back when more service and public sector deals are concluded in April. Employees will be looking for a sustained increase in pay awards after several years of no, or low, increases, but many employers are likely to still be waiting for signs of sustained economic growth. Although the outlook is for higher pay awards in 2014 than in 2013, below (RPI) inflation increases are a distinct possibility for many employees."