LONDON: British employers agreed a median 2.5 percent pay rise with workers in the second quarter, the same as in the first three months of the year, a survey by researchers Incomes Data Services showed on Thursday.
Employers in the automotive and energy sectors were the most generous, offering 3 percent annual pay rises on average, while public sector workers received pay rises of only 1 percent as part of the government's real-terms public spending cuts.
Adjusting for the fact that more staff worked for employers offering smaller pay rises, the average worker received a 1.4 percent pay rise in the three months to June.
This is slightly higher than the 1.0 percent annual increase in regular pay reported by the Office for National Statistics in the three months to May, but well below the 2.9 percent rate of consumer price inflation recorded in June.
Britain's economy has been showing signs of picking up this year after more than a year of stagnation, but below-inflation pay increases have raised doubts about the sustainability of growth that has so far been mainly driven by consumer spending.
"Our latest figures indicate signs of a recovery in manufacturing," said Ken Mulkearn, who heads IDS's pay research.
"Pay increases in private services appear unaffected by slightly higher rates of inflation but whether this gap can be bridged depends on the economic recovery in the months ahead."
IDS is owned by Thomson Reuters. Its survey is based on 177 pay deals struck in the three months to June which affected 2.2 million employees, 8 percent of the total in Britain. (Reuters)
