Manufacturing pay settlements fall sharply

Pay data for the three months to the end of April shows that the average level of pay settlements has fallen sharply, down from 1.6% for the previous three months to the end of March to just 1% for the latest three months. This is the lowest figure reported since pay surveys from the EEF began in 1987. The number of companies freezing pay increased from just over 40% to nearly two-thirds of all reported settlements in the same 3 month period, the highest level reported since the survey began. In contrast, the number of companies reporting that they had deferred their pay settlement in this three month period fell to just over 10% of all reported settlements. Commenting on the latest figures, EEF head of employment policy David Yeandle, said: "This is yet further evidence of the severe impact that the economic downturn is having on manufacturers. This latest information is significant as it contains data for April, a key month for manufacturing settlements, and there are now signs that average settlements could fall further to less than 1% over the coming months.”