Private firm pay deals rise to 3%

Brendan BarberPay deals struck in private firms in recent weeks are higher than last year, especially in manufacturing, new research suggests.

Pay analysts Incomes Data Services (IDS) said around two thirds of 30 awards recorded this year were worth at least 3% compared with a median rise of 2.5% in 2011.
Wage rises in the motor industry have been worth a median of 4% since the start of the year, while other manufacturing sectors such as engineering have also reported higher rises than last year.

Ken Mulkearn, of IDS, said: "Private sector pay settlements look like they could be higher on average than last year, but the picture so far is only a partial one.

"If this turns out to be the case, and inflation continues to fall, private sector workers are likely to welcome the prospect of an easing-off in the squeeze on their incomes that most of them experienced over the past 12 months."

TUC general secretary Brendan Barber said: "Employees will hope that these early indications of an easing in wage restraint spread beyond manufacturing and into the rest of the economy.

"But we're still a long way away from wages keeping pace with prices, let alone making up for years of real terms pay cuts, and we'll need sustained wage growth to deliver the boost in consumer spending that our economy still desperately needs.

"Union negotiators will be looking to factor the current corporate cash glut into decent pay settlements."
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