Pay awards have moved ahead of inflation for the first time in more than two and a half years, offering UK workers a little festive cheer among the gathering economic gloom, according to the latest figures released today (subscription required) by Industrial Relations Services (IRS).
But this good news could prove short-lived. Once the new pay bargaining year gets underway in January 2009, many employers are likely to find their ability to award above-inflation pay awards severely affected by the full impact of the downturn.
The median basic pay award remained steadfast at 3.8% in the three months to the 30 November 2008. This is 0.8 percentage points above the rate of retail prices index (RPI) inflation (subscription required) for November 2008 (3%).
Our final look at whole economy pay deals for this year therefore sees a continuation of the higher trend in settlements noted last month, when the median broke from the 3.5% benchmark level that has persisted for much of the past two years (subscription required for each).
The primary upward influence on pay awards is once again the October 2008 national minimum wage uprating, which saw statutory minima increase by 3.8%.
Attention now turns to January 2009, when the 2008/09 pay bargaining round will get into full swing.
- Has your organisation recently carried out an annual pay review? If so, and if it has now been settled, please get in touch so that we can add your organisation's pay award to the IRS database.
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