Manufacturing pay deferrals rise to highest level for five years

Release date: 17/10/2008

Manufacturers are battening down the hatches in response to the current economic situation by deferring or freezing pay awards and reducing the level of those which are settled according to EEF, the manufacturers’ organisation.

EEF’s latest figures for the 3 months to the end of September 2008 show that the average level of pay settlements was 3.2%, slightly lower than the figure of 3.3% reported for the 3 months to the end of August 2008.

In this period, the number of companies reporting that they had deferred their pay settlement rose slightly to nearly 1 in 10 of all settlements, the highest figure that had been reported for more than 5 years. The number of companies reporting pay freezes also rose slightly to 3.5% of all settlements.

Commenting on these latest figures, David Yeandle, EEF Head of Employment Policy, said:-

“This very high level of deferrals, together with the slight fall in pay settlements, demonstrates that manufacturers are battening down the hatches and making every effort to control costs in this period of increasing economic uncertainty."

Settlement level - per cent

Number of settlements

Zero (pay freeze)

4

0.01-2.00

8 (2 at 2 per cent exactly)

2.01-3.00

45 (32 at 3 per cent exactly)

3.01-4.00

42 (15 at 4 per cent exactly)

4.01 or more

16

The October 2008 Pay Bulletin contains information on 115 settlements covering 13,579 employees. Of these, the average settlement was 3.2% in July 2008, 3.1% in August 2008 and 2.8% in September 2008 although the figures for both August and September are based on very small samples. These figures may be subject to revision to take into account settlements for this period that have not yet been received.

ENDS

Notes for editors

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