Latest Public Sector News

20.02.12

Pay prospects up from previous quarter

There has been a positive shift in pay prospects in 2012, according to data from a survey of employers by the Chartered Institute of Personnel and Development (CIPD).

The expected mean basic pay settlement is 1.7% for the twelve months to December 2012, compared with 1.5% in the previous quarter and 1.3% at the same time last year.

In the private sector, 35% of employers predict a pay rise, with the average increase rising slightly from 2.1% to 2.2%. In the public sector, 30% predict a pay rise with the average increase at 0.8%, up from 0.3%.

However, there is a level of uncertainty in terms of pay predictions, as many organisations were unable to predict the outcome of their pay decision.

Charles Cotton, CIPD rewards adviser, said: “While the predicted increases in pay settlements reflects a cautious optimism among members in the private sector that the worst may now be over, uncertainty about how fast the economy will improve is acting to moderate pay forecasts and leading many employers to hedge their bets on the outcome of the final decision.

“As we move further into the pay round and as organisations get a better idea of how well they and the economy are likely to perform, we should see fewer feeling unable to predict the outcome of their annual pay decisions.

“Across all sectors, and whatever pay decisions are predicted, it’s vital that employers maintain an honest line of communication with employees in order to keep staff motivated and engaged; previous CIPD research has shown that employees are satisfied with their employer’s pay decision if their employer has taken the time to explain the rationale behind that decision. The same research also showed that even among those employers that do talk to employees about the basis of their pay rise, few took the opportunity to explain to staff what needed to happen in the next 12 months for staff to get another increase.”

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