The median private sector pay award has fallen slightly in the three months ending in October, from 4% to 3.9%.
According to latest figures from Incomes Data Research (IDR), the proportion of rises in the sector worth between 4.0% and 4.99% also shrank in this period, dropping to around two-fifths (39%) compared to almost half (47%) in the three months to September.
Meanwhile, the data showed pay awards worth 5% or more halved to 6% from the 12%, with changes largely driven by the manufacturing sector.
However, IDR highlighted that this time of year is traditionally relatively quiet, which is a factor influencing the latest statistics.
Zoe Woolacott, senior researcher at IDR, said: “The fall in the private sector median may be an indication that pay pressures are easing a little, together with signs of cooling in the labour market.
“However, this dip in the median has occurred at the same time as an uptick in inflation and this could maintain pay outcomes at, or around, their current level.”
The pay and employment research organisation’s analysis also found a median pay outcome of 4% for the whole economy, which is 0.1 percentage point lower than that in the private sector, while the overall median has been at 4% since July 2024.
In the latest research, the proportion of increases between 4.0% and 4.99% decreased from 47% to 37% across the economy as a whole but those worth 5% or more have remained around a fifth – unlike in the private sector alone.
According to the data, this is due to pay outcomes in the public sector, which has experienced a median of 4.9% – higher than those for both the whole economy and the private sector.
The IDR’s pay settlement figures cover more than 830,000 employees across the economy and are based on 30 pay awards effective between 1 August and 31 October 2024.
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