Manufacturing pay settlements are continuing to remain stable despite the recent rise in inflation, according to the latest information from EEF, the manufacturers’ organisation.
The average level of pay settlements for the 3 months to the end of March remained at 2.7%, the same as the figure for the two previous 3 month periods to the end of January and February respectively.. These latest figures include over 400 settlements for January, the key settlement month in the year for manufacturers.
In addition, the number of companies reporting that they had frozen pay in the three months to the end of March fell slightly to just under 6% of all settlements and was the lowest figure reported since October 2004. However, the number of companies reporting that they had deferred their pay settlement during this period remained unchanged at just under 4% and was the lowest figure reported since August 2004.
Commenting on these latest figures, David Yeandle, EEF Deputy Director of Employment Policy, said:
"Although pay settlements during the first quarter of the year have remained at a low level, the latest sharp rise in inflation may indicate that the next move could be upwards. However, this is likely to be relatively modest and does not indicate that wage inflationary pressures are building up in manufacturing".
Settlement level - %
Number of settlements
Zero (pay freeze)
29
0.01-2.00
50 ( 25 settlements at 2 per cent exactly)
2.01-3.00
278 ( 142 at 3 per cent exactly)
3.01-4.00
129 ( 17 at 4 per cent exactly)
4.00 or more
21
The April 2005 Pay Bulletin analyses 507 settlements in the 3 months to the end of March 2005 affecting 66,550 employees. Of these, the average settlement in both January and February 2005 was 2.7% and in March 2005 was 2.8% although the figures for both February and March 2005 were based on a relatively small sample of settlements. These figures may be liable for revision to take into account settlements for this period that have not yet been received.