MNI DATA: UK Pay Awards Seen Slowing From 2.5% In '19: XpertHR

--UK July-September Pay Median Pay Deals 2.5% 

By Jai Lakhani

     LONDON (MNI) - UK median pay deals were unchanged at 2.5% in the three

months through September, a survey by XpertHR found. 

     The median pay award across the whole economy was 2.5% between July and

September, with the middle half of pay awards (the interquartile range) coming

in between 2.0% and 3.0%.

     However, after this year has seen a break in the 7-year run of pay deals

2%, 365 employee groups across the private sector anticipate a slight slowdown

in 2019 to a median of 2.4% but the same interquartile range. 

     --FORECAST UNCERTAINTY

     Anecdotal evidence points to reporting agents realising the pressure to

match pay awards from other organisations, with recruitment and retention

leading to upwards pressure on pay. However, many note that they can't afford to

match pay awards and this has been made harder with the increases in employer

contributions under pensions auto-enrolment from April 2019 and an economic

outlook which remains hinged on Brexit. 

     "While the labour market is putting pressure on employers to keep up with

their competitors when it comes to pay rises, many companies simply cannot

afford to give higher pay increases. Rising pension costs (due to pensions

auto-enrolment) and uncertainty due to Brexit are likely to help keep pay award

levels in check over the coming year," said Shelia Atwood, XpertHR pay and

benefits editor Shelia Atwood. 

     The Bank of England Monetary Policy Committee's central forecast is for a

pick-up in earnings growth this year. However, the August inflation report

projections were revised down from the BOE's May projections. Headline average

weekly earnings growth were revised down from a forecast rise of 2.75% by the

end of 2018 to 2.5%.  

     In line with this 2019 forecast by Xpert HR, the BOE note in the inflation

report the low productivity levels putting downward pressure on wages in 2019. 

--MNI London Bureau; +44 203 865 3828; email: jai.lakhani@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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