The average level of pay settlements for the 3 months to the end of April 2004 was 2.7%, slightly higher than the revised figure of 2.6% for the previous 3 month period, and was the highest figure reported since June 2001.
In addition, during the 3 months to the end of April 2004, the number of pay freezes reported by engineering and manufacturing companies fell very slightly to just under 9% of all reported settlements and was the lowest figure that had been reported since March 2001. By contrast, the number of companies reporting that they had deferred their pay settlement in this latest 3 month period rose to 6.4%, the highest figure since December 2002.
Commenting on these latest figures, David Yeandle, EEF Deputy Director of Employment Policy, said:
"Although the tightening labour market is now leading to slightly higher settlement levels being reached in manufacturing, there are no real signs of wage inflationary pressures developing in this sector of the economy."
Settlement level - per cent
Number of settlements
Zero (pay freeze)
22
0.01-2.00
28 ( 23 settlements at 2 per cent exactly)
2.01-3.00
145 ( 67 at 3 per cent exactly)
3.01-4.00
37 ( 10 at 4 per cent exactly)
4% plus
18
The May 2004 Pay Bulletin analyses 250 settlements in the 3 months to the end of April 2004 affecting 37,173 employees. Of these, the average settlement was 2.5% in February 2004, 2.9% in March 2004 and 2.7% in April 2004 although the figures for both February and March 2004 were based on relatively small samples. These figures may be liable for revision to take into account settlements for this period that have not yet been received.