Manufacturing pay settlements stable

EEF’s latest monthly pay survey shows that the average level of settlement for the 3 months to the end of May 2007 was 3.1%, the same average level of pay settlements that has been reported by manufacturers since the start of the year. During the 3 months to the end of May 2007, the number of companies reporting that they had frozen pay rose slightly to just under 7% of all settlements, the highest level reported since March 2006. However, the number of companies reporting that they had deferred their pay agreement remained constant at 1.4%. Commenting, David Yeandle, EEF Deputy Director of Employment Policy, said: “The fact that pay settlements in manufacturing have remained stable since the start of the year has allayed fears, in this sector of the economy at least, that the recent increase in inflation could lead to escalating pay demands.” The June 2007 pay bulletin contains information on 347 settlements covering 63,573 employees. Of these, the average settlement was 2.9% in March 2007, 3.2% in April 2007 and 3.1% in May 2007 although the figures for both March and May 2007 were based on relatively small samples of settlements. These figures may be subject to revision to take into account settlements for this period that have not yet been received.