Median basic pay awards in the second quarter of this year were once again worth 6%, new data has confirmed.
The figures from XpertHR revealed that in the three months to June, these awards remained the same as the first quarter of 2023.
Despite being at the highest level in nearly 30 years – since September 1991 – the study found that pay is still not keeping up with inflation, equating to wage cuts in real terms for workers.
After reviewing 267 pay awards which covered 400,000-plus employees, the data highlighted that 5% was the most common outcome, agreed in nearly a quarter (23%) of deals. Three-quarters (75%) of awards were higher than a year ago, while 15% were lower and 9% were the same.
When compared to last month, the interquartile range of settlements was found to be wider, with the lower quartile at 5% and the upper quartile 9%. However, just under a quarter (24%) exceeded 9%.
In terms of pay freezes, only 3% of the public and private sector settlements reviewed reported this outcome.
A comparison between the sectors showed that the public sector’s median award was 4.5%, lower than the 6% noted in the private sector. Both experienced increases from 2022, which rose from 3% and 3.5% respectively.
While Prime Minister Rishi Sunak announced wage increases of 5-7% for various public sector employees last year, XpertHR says it is unclear whether this will help settle the existing unrest between the government and workers – particularly with industrial action still expected this month.
Sheila Attwood, XpertHR senior content manager, data and HR insights, said: “This month’s data serves as a stark reminder of how long employees have been struggling with the gulf between pay and the rising cost of living. While pay awards are at their highest level since 1991, they continue to be outpaced by the UK’s high rate of inflation.
“The prevailing view among economic analysts is that inflation will ease back during the remainder of the year, although there is far from unanimity as to how fast, and to what level. It is important that employers consider other ways they can support staff as they continue to grapple with the effects of a real-terms pay cut.”