Suban Abdullah did
LONDON (Reuters) – British employers expect the biggest wage increase for their staff in at least 11 years, but 5% pay deals for workers would still fall well below expected inflation, a survey published on Monday showed. It’s gone.
The Bank of England may find it difficult to continue to increase pay deals with inflation expected to rise, with 55% of recruiters planning to increase base or variable pay this year, the Chartered Institute of Personnel Development (CIPD) said. Because they struggle to hire and retain staff in the UK’s tight labor market.
Expected average annual wage awards rose by 5% in 2023 – the highest since CIPD records began in 2012 – up from 4% in the previous three months.
More than half of respondents reported having problems filling vacancies, and nearly one in three expected similar issues in the next six months.
“Skills and labor are scarce in the face of the labor market, which continues to be surprising given the economic backdrop of rising inflation and a cost-of-living crisis,” said John Boys, senior labor market economist at the CIPD.
The survey also widens the gap between salary expectations of public and private employers. The CIPD said salary settlements planned in the public sector fell from 3% to 2% in the prior quarter, compared to 5% in the private sector.
The results highlighted the pressure on living standards as key workers including nurses, teachers and public transport workers staged a series of strikes over pay and working conditions.
BoE governor Andrew Bailey last week voiced concerns about wage-setting, despite signs that inflationary growth may have turned a corner.
Annual inflation fell to 10.5% in December after reaching a 41-year high of 11.1% in October. Bailey indicated that inflationary pressures were still a concern despite the BoE raising interest rates to the highest level since 2008 this month.
The quarterly survey showed recruiters were more willing to hire people returning to the workforce, including older workers and those with health conditions.
The CIPD surveyed 2,012 employers between January 3 and January 25.
(Reporting by Suban Abdullah in London; Editing by William Schomberg)
Source: www.bing.com
