Subdued Pay Rises for 2016 Predicted by Employers
A survey carried out by XpertHR states that private-sector employers are expecting to give employees a pay rise of just 2%.
Employers were asked about their planned pay rise for between March 2016 and February 2017, more than a quarter are expected to be 2% and half of pay rewards will be between 1.5% and 3%.
The forecasted pay rise is above the expected level of inflation for the year. The most common way of measuring inflation is using Retail prices index (RPI). Employees are therefore receiving a real terms increase in pay- albeit following 5 years of below-inflation rises between December 2009 and October 2014.
However, there was a different prediction in the public sector. Pay rise in the public and private sectors have not matched since March 2007. Public sector employees are subject to a Government policy of pay rise worth 1%.
The gap between the two sectors may remain for the foreseeable future following the Chancellor’s announcement in July 2015 that public sector pay rise will remain at 1% for the next 4 years. There are around 1.5 million employees in the NHS that will receive a pay rise of 1.5% from April 1st 2016.
Meanwhile, those paid at the national minimum wage rate will receive an increase of 3.7%. The hourly rate for 21- to -24 year olds will rise from £3.70 to £6.95 from October 1st 2016. Employees over 25 will receive the new national living wage rate of £7.20 per hour from April 1st 2016.
XpertHR pay and benefits editor Sheila Attwood said: “Pay awards are set to remain subdued for yet another year, and a long way off the nearly 4% rise recorded just before the recession hit at the end of 2008″
Source: r15.co.uk
