Further to our recent article on average earnings, research carried out by Incomes Data Research (IDR) found that the median pay award for the entire economy remains at 2.5% for the sixth consecutive month. That is, pay rises remain stable.
Pay Rises Remain Stable
The recent report by Incomes Data Research (IDR) shows that average pay rises remain stable at 2.5%. From a sample of 184 pay rises awarded between the 1st April 2018 and the 30th June 2018, IDR found that the median pay award for the whole economy remained at 2.5%, although this was influenced to a considerable extent by a number of large pay rises of 4% and above, including one by JD Wetherspoon of in excess of 5%.
Whilst pay rises remain stable at 2.5% over the economy as a whole, the Government recently announced sizable increases for some public sector workers, following the abolition of the 1% pay cap last year. Over 1 million NHS workers will receive a 6.5% – 29% pay rise over 3 years. Meanwhile, lower paid teachers will receive a 3.5% increase, whilst higher paid teachers will benefit from a pay rise of between 1.5% – 2%. In terms of other public sector workers, the armed forces will receive a 2.9% increase, whilst prison officers will receive an increase of 2.75%. GP’s, dentists, junior doctors, and the police will get a 2% pay rise.
A Cautionary Note
Adam Corlett, senior economic analyst, from the Resolution Foundation, however, sounded a cautionary note. He warned that despite the recent pay rises, they had found from their recent Living Standards Audit that many families, particularly those on lower incomes, were worse off now than they were in 2003, and that disposable income for the 30% least well off had fallen by £150.00 (0.3%) over the last year. He said that: “Our analysis shows how important cash benefits such as tax credits have been for supporting ‘just about managing families’ and tackling child poverty since the millennium. It’s vital that government and other policy makers understand the positive impact that cash transfers have on low-income families, not least as they are in the middle of a huge multi-year programme of over £14 billion worth of benefit cuts. The risk is that, unless the lessons of the past are learnt, the future could spell squeezed incomes and further increases in child poverty.” However, these findings were questioned by James Max of Talk Radio, who stated: “It’s opinion and conjecture. Based, in my view, off deeply flawed and extrapolated analysis. Should we discuss this? Yes. Are the conclusions correct? No.”