Pay Growth Stabilises

Regular pay for employees increased by 2.8% in the three months to June compared with the same period last year.


This was the same rate as the three months to May, the Office for National Statistics (ONS) noted.


The continued stability of pay rises excluding bonuses is in contrast to the consumer prices index of inflation which is hovering around 0%.


Chartered Institute for Personnel and Development (CIPD) labour market adviser Gerwyn Davies said that overall the figures were encouraging and noted that productivity was increasing.

"The modest slowing in pay growth suggests that pay pressures are not growing as quickly as some commentators expect," he said.

"This is perhaps unsurprising given the increase in the number of young people and EU migrants in employment.


In addition, some of the increase in demand is being absorbed by part-time workers gaining more hours.

"An encouraging aspect of today's figures is that all of the employment growth over the past year has come from full-time employment, which correlates with a noticeable fall in involuntary part-time employment over the same period," he added.


The CIPD also predicted a slight reduction in wage increases over the coming year.

"Looking ahead, we expect wages increases to remain moderate, as according to our Labour Market Outlook survey, median basic pay award expectations among employers to June 2016 are 2%," the CIPD said.

Posted: Mon 20 Aug 2018
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