Pay rises “stable” at 2.5 per cent

Pay deals in manufacturing firms are “stable” at around 2.5 per cent, although the number of wage freezes is falling, a report has shown.
By The Newsroom
Published 26th Mar 2012, 09:45 BST

Increases are running at below long-term settlement levels, a survey of more than 200 companies by the EEF manufacturers’ organisation revealed.

Pay freezes have fallen to around one in 10 settlements while the vast majority continue to be below three per cent.

Hide Ad
Hide Ad

The EEF said the study backed up previous research showing that only five per cent of companies believe upward pressure on pay is their most significant risk.

EEF chief economist Lee Hopley said: “Pay settlements have remained below long-run average levels, with a sense of economic realism prevailing in the key bargaining rounds at the start of the year.

“With inflation tracking back towards target, the potential for escalating pay pressures in the year ahead shouldn’t pose a concern for policymakers.”

John Morris, chief executive of JAM Recruitment, which helped with the report, said: “The fact that modest pay rises are widespread in the sector indicates moderate growth in manufacturing and is certainly a positive sign when one considers the seemingly ubiquitous pay freezes in the wider economy.”