The Chartered Institute for Personnel and Development (CIPD) has published a new study which shows that just a quarter of UK workers have received a pay rise in 2011.
The majority of pay rises were agreed between January and May, which means anyone who hasn’t already had their salary increased is unlikely to be offered an improved contract this year, according to the CIPD.
One factor contributing to this situation is the Government’s current pay freeze, which affects the majority of workers in the public sector. Of those surveyed, 4 out of 5 public sector workers reported no pay increase this year. Where pay has been increased, this is normally at a rate below the rise in the cost of living.
The CIPD expects the number of private sector workers receiving pay rises to increase somewhat in the second half of the year, with leisure, retail and catering staff most likely to benefit when the national minimum wage is increased in October.
Some local authorities have gone beyond the Government imposed pay freeze, proposing to cut the salaries paid to their employees. Last month, Shropshire Council announced that all employees would be fired on 30th September, then rehired immediately on 5.4% less pay.
Similarly, Southampton City Council began implementing a reduction in working hours and pay for its staff at the beginning of July, which has led to a succession of strikes.
Meanwhile, Kettering General Hospital NHS Foundation Trust said in June that it intended to ask all staff to accept a pay cut equivalent to half a day’s pay each month.
As the cost of living continues to increase in the current economic climate, these decisions will put additional pressure on many people, especially those who are already experiencing debt problems.