The People Bulletin

A new survey from the CIPD has shown that employees are still feeling the pressure as pay levels fall below the current cost of living.[1]

The survey based on the responses of over 2,000 people in employment in the UK showed that 58% of employees have received a pay freeze since January and 6% have had a pay cut. Unsurprisingly it is public sector employees who have been hardest hit with 77% receiving a pay freeze compared to 52% in the private sector.

Whilst 28% of employees have received a pay rise, Charles Cotton, performance and reward adviser at the CIPD warned that "those who are lucky enough to get a pay increase will find it below the current cost of living, compounding consumer belt tightening". The median for those who have received a rise is just 3%.

According to a recent report by Vocalink the average take home pay is £1,212 lower than it was two and a half years ago. This is due to the rate of retail price inflation being higher than the rate of growth for 23 of the last 36 months.[2]

Cotton added, "we will see some increase in the number of private sector workers receiving a pay award in the second half of 2011, especially in the retail, catering and hotel sectors, as the increase to the national minimum wage comes into effect in October. However, given that the busiest time for pay awards in the private sector is between January and May, most of these workers who have not receive a pay rise so far will now probably not get one”.

[1] www.cipd.co.uk/pressoffice/_articles/employeeoutlok030811.htm

[2] http://www.vocalink.com/