The median pay award in the private sector rose in the three months to February 2026 to 3.5% from 3.4%, according to figures from Incomes Data Research (IDR).
Its research is based on a sample of 64 awards effective between 1 December 2025 and 28 February 2026, mostly at large organisations and together covering over 177,000 employees.
In the latest analysis period, the proportion of private sector pay rises worth 3% or more increased from 81% to 84% in January.
Outcomes in manufacturing and production predominantly influenced the change; the median pay award in this sector also rose to 3.5% from 3.4%.
IDR’s analysis found that this upward shift in pay rises contributed to a higher medium for the whole economy, however, the median pay rise in private services dropped a little, from 3.5% to 3.3%, which contributed to a lower median for the whole economy.
The median across the whole economy rose from 3.2% in January to 3.3% in February.
The mode, or most common, increase stood at 3.0%, with nearly a quarter (23%) of increases awarded at that level. There was also a cluster of awards at 3.5%, at which point 17% of pay rises occurred.
Zoe Woolacott, senior pay researcher at IDR, said: “There are contrasting pressures on pay. Outcomes for employees could be buoyed up somewhat by the likely inflation that will result from rising oil and gas prices, and shortages of inputs like fertilisers and jet fuel. In the opposite direction, the war in the Gulf is likely to depress economic activity generally, which would be expected to also depress wage rises.”
