Pay awards have fallen this year as data revealed most new pay deals are lower than in 2023, dropping to their lowest level since June 2022.
Analysis by data insights provider Brightmine found that the median pay award for UK employees was 4 percent in the three months to the end of August, 2024, the same as the previous quarter (revised down from 4.5 percent).
The findings, based on 67 pay settlements, covering 900,000 employees for the latest quarter (June to August, 2024) showed that 72.7 percent of the pay deals were worth less than a year ago. Only 11.4 percent of the awards were higher than in 2023.
Most common award
Throughout the year the most common pay awards were between 4 percent and 5 percent, with 20.3 percent of pay awards set at 4 percent and 18.6 percent (representing one less pay settlement) set at 5 percent.
Further data showed that the new government’s above inflation pay reviews mean public sector awards are outpacing those in the private sector.
In the 12 months to the end of August 2024, the median pay award in the public sector was 6 percent. In contrast, the median award across the private sector for the same period was 4.7 percent.
Pay awards in the manufacturing and production sector were 3.8 percent for the 12 month period, while the services sector saw pay awards of 4.3 percent.
Sheila Attwood, Brightmine senior content manager, data and HR insights, said: “We knew that pay settlements were unlikely to maintain the levels seen in 2023. Employers that have made pay awards so far this year have already reacted to the falling inflation environment by putting in place lower pay awards than made last year. However, as we look to the future, HR leaders will need to be creative with benefits packages and developing competitive packages that aren’t purely focused on increased pay.”
