LONDON (MNI) – UK manufacturing pay deals held steady at an average
2.5% in the second quarter, continuing the pattern of subdued pay growth
this year, an EEF survey shows.
Another survey out Friday, from XpertHR, found manufacturing
employers’ median expectation for pay deals over the next 12 months was
2.5%, highlighting the stability of pay deals in the sector.
Manufacturing pay deals are running well above those in the public
sector, with large swathes of that sector subject to a pay freeze, and
they have tended to at least match those in services.
Some members of the Bank of England Monetary Policy Committee had
been concerned about the risks of high inflation outturns feeding
through to higher pay deals, but the risk has not materialised.
In the EEF series the level of average pay settlements has been
unchanged since November 2011.
Lee Hopley, EEF Chief Economist, commented on the latest figures.
“Stability is the word for wage inflation so far this year. There
is still some recruitment taking place across the sector, so
manufacturers will be looking to agree pay deals that attract and retain
the skills they need. But at the same time a lot of companies are
looking at an uncertain year ahead and keeping costs under control will
be just as important,” she said.
John Morris, Chief Executive of JAM Recruitment, said “Feedback
from companies suggests that there is still considerable pressure to
manage costs but, as the skills shortage continues to bite, it will be
interesting to see if the need for employers to engage and retain key
staff has an upward impact on wages.”
“There is also likely to be some variation within sectors with the
automotive sector particularly strong, and the majority of companies
optimistic about the future,” he added.
The official data have also been painting a picture of weak
earnings growth. May headline Average Weekly Earnings showed growth of
just 1.5% on the year.
–London newsroom 4420 7862 7491; email: ukeditorial@marketnews.com
Reporting by Jack Teague
[TOPICS: MABDS$,M$B$$$]
