UK employees forecast to receive 0.8% real salary increase in 2019


UK employees working within the private sector are forecast to receive a 0.8% real salary increase in 2019, equating to approximately £20 more a month, or £237.35 a year, before tax for the average employee, according to research by data organisation ECA International (ECA).

Its Salary trends report, which analyses current and projected salary increases for local employees across 69 countries, found that the expected real salary increase for UK staff in 2019 is double its 2018 estimation of 0.4%.

Steven Kilfedder (pictured), production manager at ECA, said: “The 0.8% salary rise that we’re expecting to see in 2019 is double what UK [employees] received last year. Although the UK’s nominal salary increase, at 3%, is expected to be among the highest in Western Europe, the real salary rise is in line with the European average because of higher inflation eating into [employees’] buying power.

“It is still very unclear what impact Brexit could have on inflation and salaries in the UK. Any deal that is made, or lack of it, could have far reaching implications on wage and price rises and these figures could change significantly depending on what happens between now and the official withdrawal date in March 2019.”

Globally, employees working in India are expected to receive the highest real salary increase in 2019 of 5.1%. This compares to a 4.9% predicted increase in Vietnam, a 4.2% rise in Indonesia and a 4.1% real salary increase in both China and Thailand.

Other Asian and Indian countries expecting a real salary increase for 2019 include Bangladesh (3.9%), Cambodia (3.4%) and Sri Lanka (3.2%). The Republic of Korea and Malaysia both anticipate real salary increases of 2.7% in 2019.

“The average real salary increase in the [Asia Pacific] region is predicted to be 2.7% in 2019, over double the global average of 1.2%. Low inflation and rising productivity mean that many Asian economies, and therefore local salaries, are growing rapidly,” Kilfedder added.

Sign up to our newsletters

Receive news and guidance on a range of HR issues direct to your inbox

This field is for validation purposes and should be left unchanged.

In Europe, Ukraine tops the ranking for 2019’s highest expected real salary increase with a 2.7% rise. This compares to a 2.3% increase for employees based in Russia, a 1.8% real salary rise for Romanian employees and a 1.7% increase for those working in Bulgaria. Other high ranking European countries include the Irish Republic (1.3%), Serbia (1.2%), Germany (1.1%) and Italy (1.1%). Both the Netherlands and Norway are forecast a 1% real salary increase in 2019.

Kilfedder said: “Despite the nominal salary increase in Ukraine remaining at 10%, as it was last year, there is expected to be a big drop in inflation from 10.9% in 2018 to 7.3% next year. This is good news for [employees] in Ukraine, who will see their real terms salary jump considerably, and the 2.7% forecast is easily the highest in Europe.”