Friday May 9, 12:16 AM
UK pay deals in three months to April at highest level since August 1998 - IDS
LONDON (Thomson Financial) - UK pay deals during the three months to April climbed to their highest level for nearly 10 years as the backdrop of rising inflation meant workers managed to achieve larger wage increases, according to research from pay specialists IDS (Paris: FR0000079691 - news) .
The median pay settlement reached in the three-month period was 3.8 percent, the highest level since August 1998 and up from 3.5 percent in the three months to March.
Pay deals hovered between 3.2 percent and 3.5 percent during 2007 and the start of this year, so today's figures will worry the Bank of England that wage inflation is starting to accelerate.
April is a key month for pay deals in the private sector, and rising energy and food prices meant higher settlements could be reached with more than 25 percent of deals at or above the 4.3 percent level.
'High and rising prices for necessities are a key influence on private sector settlement levels, and to the extent that the broader economic outlook is uncertain, this hasn't prevented firms in key sectors awarding higher-end pay increases,' said Ken Mulkearn, editor of the IDS pay report.
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