Pay awards remain settled, despite public sector freeze

Pay awards remain settled at 2%, despite Government-imposed pay freezes in the public sector, according to the latest pay data from XpertHR.

The data also showed that prospects for private sector workers are looking up, with a 1.5% rise in median pay in the three months to November.

In June’s emergency Budget, the Government announced that the one-year public sector pay freeze already in place would be extended for an extra year. The 1.7 million staff in the public sector earning less than £21,000 would receive an extra £250 per year during the freeze.

Overall, pay awards were boosted by the 2.2% increase in the national minimum wage, which came into effect on 1 October, and the final stages of several long-term public sector pay deals, which paid above the current going rate.

The data also showed little variation in pay rises across different companies. Half of all pay awards were worth between 1.5% and 2.3%.

Shelia Attwood, XpertHR pay and benefits editor, said: “The main story on pay awards at present is the differing outlook for the private and public sectors. In the private sector, many employers will be hoping to reward staff loyalty through two difficult years, while acutely aware that business levels still have some way to go on the road to recovery.

“Public sector workers, on the other hand, are bound by government policy, so a large number of public sector workers will not receive a basic pay rise in the year ahead.”

XpertHR’s research is based on details of 73 pay reviews from 1 September to 30 November 2010. Read the full report here.

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