Manufacturing pay deals chart course of downturn
1 min read
The extent to which manufacturing companies have had to react to the speed and depth of the recession since last autumn is highlighted by pay settlement levels falling yet again to an historic low as they have charted the course of the downturn.
According to figures from the manufacturers' organisation EEF, average manufacturing pay settlements for the three months to the end of May have fallen to 0.8%, down from 1.0% for the previous three months to the end of April. As recently as last September when the economy turned down sharply in response to the financial crisis, average pay settlements in manufacturing were still running at 3.1%.
The figures also showed the number of companies freezing pay rose slightly to two-thirds of all reported settlements in the same three month period, the highest level reported since the survey began in 1987. The number of companies reporting that they had deferred their pay settlement in this three month period also increased slightly to just under 13% of all reported settlements.
EEF head of employment policy David Yeandle said: "These latest figures demonstrate not just the severity of the downturn since last autumn but the serious efforts that companies have taken to control their costs. Compared to previous recessions, this period has also been marked by employees and their representatives working positively with employers to manage pay as a way of helping maintain employment levels."
