Increase in deferred pay settlements

More
engineering companies are deferring their pay settlements, according to the
latest figures reported by the Engineering Employers Federation (EEF) and pay
settlements in the engineering sector are still at an historically low level.

For
the three months to the end of July 2002, the number of companies reporting
that they had deferred their pay settlement rose to nearly 15 per cent, the
highest level reported by the EEF for more than two years.

During
this period, the average settlement level reported rose slightly to 2.2 per
cent from the revised figure of 2.1 per cent for the previous three months and
the number of pay freezes fell to just under one in five of all reported
settlements.

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Commenting
on these latest figures, EEF deputy director of employment policy David Yeandle
said: "These figures support our view that the Monetary Policy Committee
made the right decision to keep interest rates at their current level, as there
are clearly no wage inflationary pressures coming from this sector of the
economy".

By Ben Willmott