Manufacturing pay hiked as inflation soars and skills shortages bite
Make UK Survey – Manufacturing pay hiked as inflation soars and skills shortages bite
Pay increases range from 1% to 14%
Just 2% of companies freeze pay compared to a third last year
Almost a quarter of companies defer agreement
Two fifths of companies agree settlement, but a similar number keep under review
- Majority of settlements between 2% and 3%
Britain’s manufacturers are seeing pay pressures rise in response to the soaring rate of inflation and the battle to attract and retain key skills and talent escalates according to the latest survey of manufacturing pay settlements published today by Make UK.
The survey also shows that while some companies have come to an agreement, a large number have yet to come to agree a settlement as they wait to see how the inflationary picture develops and the impact of forthcoming increases in National Insurance and the Minimum Wage.
Furthermore, the level of some of the increases signifies that companies feel it is time to reward staff for the efforts they have made over the last couple of challenging years in response to the pandemic.
According to the survey while two fifths of companies have come to an agreement, 45% of companies are keeping their agreement under review. In addition, the survey shows stark comparisons with January last year with just 2% of companies freezing pay and 4% deferring agreements. This compares to a third and almost a quarter (22%) last year respectively.
While the majority of settlements were between 2% and 3% the highest settlement was 14%, compared to a highest settlement last year of 5.8%.
Commenting, Verity Davidge, Director of Policy, said:
“The picture for manufacturing pay settlements compares starkly with this time last year when, for many companies, it was a simple choice of freezing or deferring agreements given the severe impact of the pandemic.
“While some companies clearly feel they need to reward their staff for the last couple of challenging years, others are facing battle to attract and retain key skills. As a result, the picture this year for manufacturers agreeing pay settlements is far more complex.”
The survey of 152 companies was carried out in December