Average Weekly Earnings: zero growth just around the corner
This month’s employment statistics revealed a danger for pay increases that hasn’t had enough attention: unless average weekly earnings start rising soon, the rate of annual increases is going to fall to very near zero.
Here’s the figures for the last twenty months:
|
% change year-on-year |
|||
|
Average weekly pay (£) |
Single month |
3 month average |
|
| Apr 11 |
460 |
2.5 |
2.1 |
| May 11 |
461 |
2.5 |
2.5 |
| Jun 11 |
465 |
3.3 |
2.8 |
| Jul 11 |
464 |
3.0 |
2.9 |
| Aug 11 |
462 |
2.1 |
2.8 |
| Sep 11 |
463 |
1.9 |
2.3 |
| Oct 11 |
465 |
2.2 |
2.1 |
| Nov 11 |
466 |
2.2 |
2.1 |
| Dec 11 |
465 |
1.9 |
2.1 |
| Jan 12 |
464 |
0.1 |
1.4 |
| Feb 12 |
462 |
0.8 |
0.9 |
| Mar 12 |
465 |
1.0 |
0.6 |
| Apr 12 |
471 |
2.3 |
1.4 |
| May 12 |
469 |
1.8 |
1.7 |
| Jun 12 |
471 |
1.3 |
1.8 |
| Jul 12 |
471 |
1.5 |
1.6 |
| Aug 12 |
473 |
2.3 |
1.7 |
| Sep 12 |
471 |
1.8 |
1.8 |
| Oct 12 |
471 |
1.3 |
1.8 |
| Nov 12 |
472 |
1.3 |
1.5 |
Most comments have focused on the annual rate of increase. With good reason: it’s well below inflation and headed in the wrong direction.
But look at the cash value: since last April it has hardly budged. If that remains the case, the ‘single month’ figure for annual earnings increases will fall to zero this April (appearing in the figures out in June) and the ‘3 month’ figure will follow it two months later.
The implications for pay negotiators, facing employers claiming that no pay rise is the ‘new normal’ will be significant. And there will be knock-on effects for the debate about benefits uprating.
What can unions do to win real terms pay increases? This is the focus of this year’s TUC-IDS Pay Bargaining Forum at Congress House on 6 March. Speakers will address the different dimensions of this problem, with plenty of time for questions from delegates. Incomes Data Services are organising registration for this event through a dedicated website – book now to avoid disappointment!