People walk through the Canary Wharf financial district of London, Britain, December 7, 2018. REUTERS/Simon Dawson
LONDON (Reuters) – British employers offered staff pay rises averaging 2.5% as part of wage settlements in the three months to May, industry data showed on Thursday, matching the trend seen for most of this year.
Human resources data firm XpertHR said pay settlements had hovered around the same level since the start of 2019, despite a small pick-up in inflation.
“Following a dip in the second half of 2018, the first half of 2019 is dominated by pay rises in the region of 2.5%,” XpertHR analyst Sheila Attwood said.
After years of falls in pay when adjusted for inflation, Britain’s workers have had some of the biggest pay rises in a decade in recent months due to a tight labour market though they are modest compared to pre-financial crisis rates of pay growth.
The risk of a disruptive Brexit has made some employers more willing to hire new staff, who can be sacked if the economy sours, than to make long-term labour-saving investments.
Pay settlement data is typically lower than the headline measure of wage growth, as it does not include pay increases gained through changing jobs or promotions.
Official data last week showed average annual wage growth excluding bonuses was 3.4% in the three months to April, just off a 10-year high of 3.5% recorded at the turn of the year.
The Bank of England forecast last month that pay growth would ease to 3% this year. But policymakers are concerned inflation will hover above its 2% target unless it raises interest rates slightly over the next couple of years.
Reporting by David Milliken; Editing by William Schomberg