The median pay increase in the private sector remained at 3.5% for the three months to March 2026, according to figures from Incomes Data Research (IDR).
Its research was based on a sample of 87 awards between 1 January and 31 March, mostly at large organisations and covering more than 630,000 employees.
Awards worth 4% or more grew from 16% in February to more than a fifth, which pushed the upper quartile from 3.7% to 3.8%. This was due to the median in private services outcomes rising from 3.3% in April to 3.5% in March.
Meanwhile, the median for the whole economy also remained at 3.5% in March. The largest cluster of pay outcomes, which was 63%, occurred in the 3% to 3.99% bracket, although this fell from 67% in the three months to February. The upper quartile rose from 3.6% to 3.8% due to a larger proportion of higher-end awards worth 4% or more.
Awards in the private services subsector worth 4% or more grew from 16% in February to 21%. These were across various industries but were most common in retail. A total of 65% of private services awards were between 3% and 3.99%.
Meanwhile, outcomes in manufacturing and production are unchanged since February. The median remained at 3.5% and the interquartile range of awards was between 3% and 3.8%.
Zoe Woolacott, senior pay researcher at IDR, said: “Higher-end awards worth 4% or more are more common in April than at the start of the year due to the influence of the uplift in the national living wage. This year’s increase was 4.1%, which brought the minimum hourly rate of pay for workers aged 21 and over to £12.71. This particularly impacts workers in the low-paying sectors such as care, hospitality and retail.”
