Private sector pay awards outstrip public

Pay reviews in the public and private sectors has resulted in a discrepancy between the amount of pay freezes brought in, new figures show.

A survey from XpertHR reveals that of the 29 pay reviews recorded in the public sector effective April 2012, 55 per cent resulted in a pay freeze. In contrast, only 15 per cent of reviews in the private sector ended up in a freeze.

XpertHR says that many of the pay freezes in the public sector are for those involving national pay arrangements, and because of that the numbers covered are high.

With April being the most congested month for pay settlements, when around four in ten pay awards are settled during the period, the median basic pay award in the three months to the end of April 2012 was 2 per cent, down 0.6 percentage points from the 2.6 recorded in the previous quarter.

Sheila Attwood, editor for Pay and Benefits at XpertHR, comments, ‘In contrast to the pay scene in the public sector, pay awards in the private sector are holding up, at around 2.5 per cent. Within this, manufacturing awards, at 2.5 per cent, are outpacing those in private sector services, at 2 per cent.

‘We expect the current pattern of pay awards to continue over the coming months, in which case the squeeze on real incomes will continue for some time to come.’

Further findings show that there is evidence that some higher increases are being awarded. Statistics indicate that 28.4 per cent of private sector pay awards are worth 3 per cent or more, with the most common increase in the sector being 3 per cent.

XpertHR’s research is based on what it calls the largest sample of pay deals collected in the UK – 241 awards effective in the three months to the end of April 2012. Of those, 175 provide an identifiable increase in the lowest adult rate of pay, and form the sample or its analysis.

Hunter Ruthven

Hunter Ruthven

Hunter was the Editor for from 2012 to 2014, before moving on to Caspian Media Ltd to be Editor of Real Business.

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