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23 June 2011

Pay settlements show gradual rise

Settlements showed a rise in the median (midpoint) - up from 2.5% in the three months to April to 2.7% in the three months to May, according the the Labour Research Department's Payline database.

However, with inflation unchanged on the two main measures - the RPI and CPI - there is a large gap between settlements and price increases.

The level of settlements varied considerably by sector; the private sector median was 3.0% but the public sector median was zero - that is 0.0%. For manufacturing the rise was 3.0% but in services it was only 2.5%.


Wage settlements in manufacturing have continued to show a continued gradual increase as pay bargaining returns to normal levels, according to the latest figures from the EEF manufacturers' organisation.

Despite the small increase, there continues to be little sign of wage inflationary pressures. EEF's pay data for the three months to the end of May (including that for April, the second busiest month for settlements) shows that the average pay settlement for the period increased to 2.6%, up from 2.5% for the three months to the end of April.

The EEF's analysis shows the proportion of settlements agreed at more than 3% continued to drift upwards in the three months to May, but, at the other end of the spectrum, one in seven pay deals are pay freezes. Continuing the trend seen through much of the year so far, settlements between 2% and 3% remained the most common.



This article originally appeared in Fact Service - LRD's weekly bulletin for union negotiators.


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