While ONS figures have seen starting salaries rise, data from XpertHR has found that the median basic pay award between May and July 2021 is worth 2 per cent, unchanged on the figure seen in each of the three previous rolling quarters. The specialists say this is a welcome stabilisation on pay after the median pay award fell to nil in the same period a year ago.
In the 12 months to the end of July 2021, the median pay award in the public sector sits at 2 per cent, with the interquartile range between 1.2 per cent and 3 per cent. Over the same period, pay awards in the private sector are worth 1.5 per cent at the median, with the middle half of awards falling between nil and 2 per cent. The whole economy median over the year to the end of July 2021 is also 1.5 per cent. That said, the value of pay awards in the public sector has fallen to 2 per cent in recent months, having been static at 2.5 per cent for the past couple of years.
Notably, in the services sector – which includes both public and private-sector services – the median in the three months to the end of July 2021 is 2 per cent, with almost two thirds (63 per cent) of pay awards worth this much or more. This is the highest median pay award in the sector recorded by XpertHR since last November, though the sector also saw the only pay freezes recorded in this latest data. The interquartile range extends from 1.5 per cent to 2.7 per cent.
Based on details of 36 pay settlements effective between 1 May and 31 July 2021, covering more than 687,000 employees, XpertHR also found:
• Half of pay awards are higher. In a matched sample of 28 pay deals (both basic and performance based), 54 per cent are higher than the same employee group received the previous year, while a quarter (25 per cent) are lower. More than one in five (21 per cent) are set at the same value as the previous year. Conversely, in the same period in 2020, more than half (61 per cent) were lower and only around one in six (18 per cent) were higher.
• Pay freezes becoming less common. Pay freezes account for a relatively small number of pay deals in our current three-month sample, with just two settlements recorded at nil. In the same period last year, pay freezes accounted for more than half (51 per cent) of the total sample of pay settlements.
“2020 marked the worst year for pay awards since 2010, so it is welcoming to have seen pay deals rising and now stabilising,” said Sheila Attwood, XpertHR pay and benefits editor. “It is likely that awards will remain at this level as employers are still regrouping and looking to strike the balance between recruitment and wider reward package costs.
“Despite movements to end restrictions and a move towards a ‘return to normal’, best reflected in the two percentage points increase in private sector median pay awards over the past year, uncertainty still remains,” she said.
