LONDON (Reuters) – British employers are offering higher pay deals in the face of staff shortages and rising inflation, according to a survey published on Thursday when the Bank of England is expected to increase interest rates for the second time in two months.
Incomes Data Research, which monitors pay reviews, said employees were typically receiving raises worth 3.0% in 2022, up from 2.0% during 2021 as a whole, and fewer employers were implementing a pay freeze for workers.
The 2022 figure was based on 57 pay awards affecting almost half a million employees overwhelmingly in the private sector, whereas the 2021 figure included a greater proportion of public-sector workers, many of whom had their pay frozen.
More than a fifth of pay awards in retail and road transport were worth 4% or more this year and that kind of pace was likely to continue with Britain’s minimum wage due to go up by 6.6% from April 1, IDR said.
The BoE has said it is concerned about the build-up of inflation pressure in the labour market with consumer prices having risen by 5.4% in the 12 months to December, the sharpest increase in 30 years.
The central bank is expected to announce at 1200 GMT that it is raising its benchmark Bank Rate to 0.5% from 0.25%.
UK employers push up pay deals as staff shortages and inflation mount
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