UK Median Pay Settlement Slows To 1% In 3 Mos To July

LONDON -- The median annual pay settlement in the U.K. dropped to 1% in the three months to July, a survey by Incomes Data Services showed Thursday.

The low pay increases of earnings deals come at a typically quiet time of year for pay deals, and with the key bargaining month of April now out of the analysis, the number of settlements monitored in the July survey fell to 75 from 235 in the June survey.

IDS reported the average pay settlement was 2% in the three months to June and also in the May survey.

"When we were monitoring relatively large numbers of deals overall, these acted as a counterweight between the two sides of the scale," said Ken Mulkearn, editor of the IDS pay survey. "The number of deals monitored has now fallen sharply and the continued large proportion of [pay] freezes has weighed slightly heavier in the balance."

The survey showed that there has been a continued trend towards pay freezes which has also kept average pay settlements at a lower level, although there have been some settlements of up to 2.5%, the IDS said.

In the year to July, the average pay deal was 2.3%, based on 545 settlements, with just under one third of those deals agreed being pay freezes, the IDS said.

Official data showed that average earnings rose 2.5% in the three months to June, up from 2.3% in the three months to May. But the measure of earnings that strips out wages rose a record low 2.5% in the three months to June, down from a 2.6% rise in the three months to May.