Manufacturing pay starts to rise, as inflation increases

Pay deals were up and pay freezes were down in January, says the EEF

Average pay settlements have gone up, while pay freezes have gone down, according to the latest data from EEF, the manufacturers’ organisation.

While the data boded well for the rest of 2017, the EEF said the acceleration remained modest compared with that of consumer price inflation. This meant that workers could still end up feeling the pinch while employers could come under wage pressure, it added.

The EEF’s Pay Bulletin noted that with a significant number of pay settlements agreed in the January bargaining round, the monthly data was a useful predictor of wage growth across manufacturing for the year ahead.

It said the monthly average pay settlement for January alone at 2.0%, was slightly up from the average pay deal of 1.8% for the same month a year ago.

Pay deals

Between November and January, two-thirds of pay deals were agreed at or below 2%, consistent with the distribution of settlements over the past year.

However, the upward move in the average pay deal in January reflected two major trends at both ends of the pay spectrum, the EEF claimed.

The first was the fall in the proportion of settlements resulting in a pay freeze. Pay freezes became a more prominent feature for manufacturers in 2016, peaking at 26% of settlements in August as firms became more cautious in the face of uncertainty.

But in January this year, the share of pay freezes fell back to 9% of settlements agreed since November and to 7% of settlements for January alone.

Share of pay deals fell

The second trend was a slight rise in the proportion of pay deals agreed above 2%. These accounted for one-in-three pay settlements in the three months to January, most of which fell in the 2–3% range.

“The first indications from the January major pay round show an increase in average settlements across manufacturing,” said Lee Hopley, EEF chief economist.

“As uncertainty continues around business conditions, manufacturers remain cautious when it comes to pay rises.”

FoodManufactureJobs Set up a Job Alert

Related News

Government urged staff to check their pay before new wage rates

Low-paid staff urged to check pay ahead of wage changes

Workers at Tunnock's recieved an 8.7% pay rise over two years (Flickr/Meaning Conference)

Tunnock’s workers ‘given 8.7% pay rise’

Supermarkets are focused on every-day low prices rather than promotions

Supermarket food promotions dip to 11-year low

Inflation are forecast to overtake pay rises in the manufacturing sector

Manufacturing pay rises scrape ahead of inflation

A review of pay scales at Cott Beverages could see skilled workers worse off, claimed a workers' representative

Pay fears for drinks factory staff

Engineers have seen a rise in their pay since 2015, according to EEF

Food manufacture engineers see 4% boost to pay

Getting young girls interested in STEM subjects could help bridge the gender pay-gap

Focus on STEM subjects could solve gender pay-gap

Who should pay for nutrition research, asks Food Manufacture editor Rick Pendrous?

So, who should pay for nutrition research?

Food manufacturers with more than 250 staff should prepare for gender pay reporting

Gender pay rules: what you need to know

Submit a comment

Your comment has been saved

Post a comment

Please note that any information that you supply is protected by our Privacy and Cookie Policy. Access to all documents and request for further information are available to all users at no costs, In order to provide you with this free service, William Reed Business Media SAS does share your information with companies that have content on this site. When you access a document or request further information from this site, your information maybe shared with the owners of that document or information.