Average real-time pay rises in the UK are set to reach 3% in 2015, according to research by Towers Watson.
Its Salary budget planning report, which had 8,000 responses from organisations across 110 countries, also found that the average pay increase in Germany is expected to be 2.9%.
Respondents from Italy, France, Spain, Ireland, Switzerland, Portugal, Belgium, Greece, and The Netherlands have all budgeted for lower employee pay increases of between 2% and 2.6% this year.
Paul Richards, head of data services practice for Europe, Middle East and Africa (EMEA) at Towers Watson, said: “In 2015 many employees will feel the tide has turned. A combination of decent pay rises and record-low inflation means that British employees are starting to see a real rise in their income after years of frustration.
“The outlook in the rest of Western Europe is more muted in terms of pay rises, but in all of these countries pay rises are set to significantly outstrip inflation, which has not always been the case over the last few years.
“Even if inflation rises to 1.5% next year as expected, this is still an historically low level. By comparison, between 2011 and 2013 we were experiencing annual inflation of between 2.5% to 4.5% and pay rises that barely matched or were significantly below, so 2016 is still expected to see a healthy real-term growth in wages.”