Pay settlements back to normal says EEF
1 min read
Average pay settlements in the UK manufacturing sector are creeping upwards but appear although the relatively small quantum of them indicate few obvious signs of untoward pay inflation.
According to the latest figures from the manufacturers' organisation EEF, and JAM Recruitment, the average pay settlement for the three months to the end of July was 2.7%, up from 2.5% for the three months to the end of June. EEF believes the apparent increase is based on a relatively small number of settlements and shows that pay settlements are remaining at or around long term historical levels.
With around three quarters of settlements at or below a trend line registering 3% since the recovery began the latest data "continues to reflect economic realism amongst employers and employees".
Commenting on the latest figures EEF chief economist Lee Hopley said that while there was some anecdotal evidence of pressure on companies to settle at a higher level, "when it comes down to it all parties are still having to face up to uncertain economic conditions and competitive pressures".
JAM's John Morris said that some market rates were skewed because of acute demand for skills but this was "counterbalanced by employers' careful attention to budgets and the strength of the sales pipeline. Apart from a few notable exceptions, we can expect the majority of settlements and salaries to remain in uneasy equilibrium for some time".
