Jun 21, 2022 01:41AM ET
By: AnalysisWatch
Annual pay increases agreed in U.K. workplaces settled at historically high levels last month but continued to lag behind rising inflation.
XpertHR, a publisher of pay and workforce data, said employers' pay settlements in the three months to May averaged 4%, unchanged from the previous month.
While this is the highest level since 1992, it lags far behind consumer price inflation of 9% in April.
XpertHR's report followed a Bank of England business survey that showed employers surveyed in May were not planning any further acceleration in wage increases.
More than 50,000 British rail workers will begin their biggest strike in 30 years on Tuesday to protest the pay freeze and job cuts, in what unions are calling the start of what could be a "summer of discontent."
Prime Minister Boris Johnson has spoken of the need for a high-wage economy, but warned earlier this month that the danger of a damaging wage-price spiral—in which wages chase rising prices in a self-reinforcing cycle—must be averted.
A letter sent to Johnson on Friday by 67 economists said there is no wage-price spiral underway in the U.K. and that keeping wages low would risk a recession.
Changing jobs is a key way to boost wages, and on Monday, the Chartered Institute of Personnel and Development, a trade association, said 20% of workers were considering quitting, up from 16% a year ago.
Official labor market data has brought mixed news lately.
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