British employers keep median pay settlements unchanged at 3.5% in the three months to April, even as the minimum wage rises and the Bank of England approaches its next rate decision. The latest figures point to stable headline wage awards but also show a bigger share of companies granting increases of 4% or more.
Highlights
- Median pay rise among major UK employers holds steady at 3.5% for February to April, covering over 3.3 million workers, according to IDR survey.
- Proportion of firms granting pay rises of 4% or more increases to 33% in April from 21% in March, led by engineering, energy, and water sectors.
- Private services sector pay awards dip to 3.3% in April from 3.5% in March, while retail and hospitality workers near minimum wage see higher increases.
April survey data and policy backdrop
As reported by Reuters, Incomes Data Research says the median pay rise awarded by major employers is 3.5% in the February to April period, unchanged from the three months to March.The survey is published in the week before the Bank of England's interest rate decision. The central bank is expected to leave rates unchanged at 3.75% next week, while continuing to monitor pay growth as a measure of inflation pressure in the economy.
IDR says April is a month with higher pay awards as the minimum wage rises by 4.1% to 12.71 pounds an hour for workers aged 21 and over. The survey is based on 166 pay awards between February 1 and April 30, covering more than 3.3 million workers.
Sector trends and broader wage impact
The survey also shows the proportion of firms offering pay rises of 4% or more climbs to 33% in April from 21% in March. IDR links that increase to larger awards in engineering, energy and water companies.In the private services sector, pay awards fall to 3.3% from 3.5% in March, although workers in retail and hospitality roles paid close to the minimum wage receive larger increases. The mix of steady overall settlements and pockets of stronger rises suggests wage pressure remains uneven across sectors as policymakers assess risks to inflation.
In our earlier article on elevated UK gilt yields and borrowing costs, we explained how persistent inflation risks and market sensitivity are tightening the government’s room for manoeuvre. We also noted that Bank of England communication can move bond prices more than day-to-day political messaging, leaving policymakers focused on measures that improve inflation resilience and long-term growth.
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