Latest research published by LexisNexis IRS and conducted by the IRS Pay Databank finds that average pay settlements have increased slightly since the end of last year to reach 2.9%, the highest average figure since November 2001.
Despite this, pay increases continue to be moderate, with the average settlement remaining below 3% for over 3 years. The study also found that public sector pay increases continue to be above those in the private sector, averaging 3.2% compared to 2.5% for private organisations, although this reflects the above-average increases awarded in public sector deals last summer. Teaching staff have recently been awarded an increase of 2.9%, while senior civil servants are likely to receive an increase in salary of just 2.25%. In the manufacturing and services sectors, pay awards are also increasing, with, for example, 4% awarded to 14,400 employees at Ford Motor Company and average service sector pay awards increasing to 2.7% in January.
IRS Pay and Benefits Bulletin Editor, David Carr, said:
“Following the upturn recorded in January, we expect the current level of settlements to be sustained in the coming months. The rise in inflation, recorded at the end of last year, will be driving this and will be reflected in pay settlements pushing the 3% mark in the near future…the rise seen at the end of last year will put pressure on employers to implement higher pay awards at the beginning of this year.”
