UK pay settlements hold at record 6% – XpertHR
2023.06.20 20:29
© Reuters. FILE PHOTO: People walk through the ‘More London’ business district with Tower Bridge seen behind in London, Britain, March 16, 2023. REUTERS/Toby Melville
LONDON (Reuters) – Pay awards by British employers remained the highest in more than 30 years in the three months to May, keeping pressure on the Bank of England which looks set to raise interest rates again on Thursday in a bid to tame high inflation.
Human resources data firm XpertHR said the median basic pay settlement in the three months to the end of May remained at 6%, matching the record increases seen in the five rolling quarters before but well below inflation which stood at 8.7% in April.
XpertHR has been tracking settlements since 1991.
Wednesday’s data includes pay awards agreed in April, a key month for pay deals between employers and workers.
“Although inflation is beginning to fall as we enter the second half of this year, it still lies far ahead of pay rises, meaning employees will remain grappling with the effects of a real-terms pay cut,” Sheila Attwood, senior content manager at XpertHR, said.
Consumer price inflation data for May is due to be published at 0600 GMT on Wednesday. Economists polled by Reuters expect the pace of prices rises to have eased to 8.4%.
The BoE is concerned that price rises could be harder to tame if pay deals keep growing. It is expected to increase Bank Rate by a quarter percentage point to 4.75% on Thursday, its 13th hike in a row.
Official labour market figures last week showed stronger-than-expected wage growth in April.
XpertHR said employers continued to report skills shortages and issues with staff retention, despite some signs of easing labour market conditions.
