Pay freezes hit more senior staff than manufacturing or clerical workers

Senior staff have been hit hardest by pay freezes, according to global research.

The quarterly Salary Indicator compiled by consultancy Mercer found that nearly half (47%) of firms had instigated a pay freeze, while 15% said they were considering it.

HR directors from 75 blue-chip multinational organisations representing 3.5 million employees were polled, and just over one-third (37%) said they were increasing pay for executives, while 46% said they were increasing wages for managers.

This compared to nearly two-thirds who said they were increasing pay for manufacturing and service staff (59%) and office and clerical staff (59%).

Chris Johnson, head of Mercer’s UK human capital business, said employers were still relying on performance-related pay awards in the recession.

“Most companies are still determining pay on a localised and individual basis, according to need and performance,” he said.

“Many companies approach pay negotiations on a long-term basis and find themselves bound by agreements negotiated in the bounteous years of 2007. There will be some intense bargaining ahead as companies try to meet promises made to their workforces, while remaining realistic.”

Separate research by Income Data Services found that 20% of UK workers face a pay freeze in 2009.

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