Pay awards refuse to rise as employers cope with Covid challenges
Pay freezes continue as employers cope with the ongoing challenges of the coronavirus pandemic.
According to the latest data from pay analysts XpertHR, more than a fifth (21.1%) of all pay reviews for the quarter up to the end of October 2020 led to a salary freeze. The median basic pay award across both the private and public sectors stood at 2%, it said.
XpertHR also updated its median measure for the previous quarter from 0 to 1%.
The final months of the year tend to be quiet in terms of settlement data as most employers have already concluded pay reviews, so the sample is a small one, of 51 awards.
Based on the sample, it found that there was a wide interquartile range in pay awards – with the middle half of pay deals worth between 0.6 in the lower and 2.8% in the upper.
More than half (51.4%) of the awards recorded were lower than the same group of employees received a year ago. The rest were split fairly evenly between those that stayed the same (25.7%) or higher (22.9%).
In the private sector, the median pay award recovered to 2% in the three months to the end of October 2020, from a pay freeze in the previous three rolling quarters.
However, this time last year pay awards in the sector were running at 2.5% – a level they have failed to reach in 2020. This time last year the top quarter of awards were worth 3% or more – now, this is at just 2.2%.
The 12-month pay award figure is also down on last year in the private sector. Over the 12 months to the end of October 2020, the median pay award was 2%, down from 2.5% in the year to October 2019. In the public sector, pay awards remain unchanged over the 12-month period, at 2.5%.
XpertHR pay and benefits editor Sheila Attwood said: “So far this year around one-fifth of all pay reviews have resulted in no movement in pay for employees.
“While a desire to save jobs is a focus for some, others are struggling with the funds to recognise the very employees who have kept their businesses going through the pandemic. With a second national lockdown now in place, organisations need to look out for their workforce and keep them motivated ready for when the economic recovery happens.”