Workers received a “real-terms” pay rise in last quarter, says XpertHR

Employees received a slight “real-terms” increase in pay in the three months to August 2016, according to findings from pay analysts at XpertHR.

The median pay award for the months of May, June and July was 2%, with the middle half of pay awards worth between 1.2% and 2.2%.

This was a slight increase on the rolling quarter up to and including April, when the median award level dipped to 1.8%. This was influenced heavily by the large number of public sector pay deals, which have been fixed at 1%, during that period.

Although the level of pay increase remains subdued, low levels of inflation mean that this represents a real-terms rise for many employees.

XpertHR points out that pay awards have been running above retail prices index (RPI) inflation since the end of 2014, although the gap has now narrowed to just 0.1% – RPI was 1.9% in July, while pay awards were stuck at 2%.

The data also revealed that almost half (48.9%) of pay awards were lower than the award received by the same group of employees last year.

Around one-fifth of pay awards were higher, and just over 30% were at the same level.
The median pay award across the private sector remained consistent across both manufacturing and production, and the services sector.

XpertHR pay and benefits editor Sheila Atwood said: “The busiest part of the year for pay awards is now behind us. Based on data for the year so far, we see no signs that pay award levels will increase in the remainder of the year.

“We expect 2% to remain the benchmark pay award through to the end of 2016.”

This latest quarterly analysis was based on a sample of 53 pay awards, effective between 1 May and 31 July 2016.