A third of workers face
pay freezes

A newly published study has revealed that a third of workers are facing a pay freeze this year.

Research by wage analyst Incomes Data Services (IDS) found that on average settlements rose to 1.9%, but dropped to 1.4% in private companies.

The report predicted from early indications that public sector workers would be awarded smaller pay rises compared to 2009. It also said wage freezes may be imposed on many local government workers.

Overall, employers have awarded smaller increases this year compared to 2009.

Pay rises averaged 1% at food and drink manufacturers and in the retail sector, rising to 2% at aerospace and defence companies and in finance.

Ken Mulkearn of IDS said: "Our analysis of basic pay settlements shows broadly stable, though modest, growth. If the economy recovers we would expect earnings to rise, even if some pay freezes continue.

"Inflation, which has risen sharply to stand at 3.7% in the year to January, will produce another upward pressure on earnings, through its influence on pay setting."

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