EEF research: Manufacturing pay returns to historic level

Manufacturing pay has risen to 2.5% in the three months to the end of April 2011, but is a return to historic levels according to data from the manufacturers’ organisation EEF. 

The May 2011 Pay Bulletin, from the EEF and Jam Recruitment, found that the average pay settlement for the period crept up from 2.4% for the first three months to the end of March 2011.

However, despite the small increase approximately 80% of settlements were below 3%, while just under 14% of organisations were still operating pay freezes.

Lee Hopley, EEF chief economist, said: “We have now been through the two single busiest months for wage negotiations and there remains little evidence of significant upward pressure on pay.

“Despite the small increase we are only returning to the level of settlements we would expect to see by historical standards.

“Economic uncertainty and the need for [organisations] to control their costs in the face of global pressures continue to be the main driver of agreements.

John Morris, chief executive of Jam Recruitment, said: “Assertions that this month’s average pay settlement, the highest since January 2008, is an indication of sustained wage inflation in the manufacturing sector may well be premature, but it is heartening that after two years of fluctuation, the majority of pay increases appear to have settled around modest levels.”

Read more articles on pay increases in manufacturing