Manufacturing pay settlements lowest for 18 years

Pay
settlements in the engineering and manufacturing sectors have been forced back
down to their lowest level since 1984, according to the latest Engineering
Employers Federation figures.

For
the three months to the end of June 2002, the average settlement level fell to
2.0 per cent, down from 2.1 per cent for the previous three months to the end
of May.

The
EEF said the figure is given greater significance as it includes settlements
for the month of April – the second most important month for wage negotiations.

In
addition, during this period, the number of pay freezes and deferred pay
settlements both rose slightly to just under 1 in 4 and almost 12 per cent of
all reported settlements respectively.

EEF
deputy director of employment policy, David Yeandle, said: “These latest
figures confirm that wage inflationary pressures in this important sector of
the economy remain benign and should cause no worries for the Monetary Policy
Committee. They reinforce our view that, combined with other economic
pressures, there is every justification for interest rates being left on hold
for the foreseeable future.”

By Quentin Reade

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