Just as our headline measure of pay awards rises to its highest level since March this year, so inflation also pushes upwards.

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Pay & Benefits Bulletin
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  THE EDITOR'S MESSAGE Issue 693  
  INFLATION WIPES OUT PAY RISES
Sheila Attwood, Editor

Just as our headline measure of pay awards rises to its highest level since March this year, so inflation also pushes upwards. The gap between the level of increase in pay rates - 3.5% - and the increase in prices - 5% - remains at a historically high level.

Our latest monthly analysis of pay settlement trends also looks at the current forecasts on inflation, earnings, and economic growth.

Senior staff in the public sector, including those employed by the armed forces, the civil service, the NHS and the judiciary, have received pay increases this year that are well below those across the economy as a whole. Our round-up of these pay awards, covered by the Review Body on Senior Salaries, reveals pay rises in the region of 2.2% to 2.5% for the majority of those affected.

Other stories in this issue include:

If you are interested in the factors that will shape the wage bargaining environment over the coming year, you can take part now in our annual pay prospects research. Respondents will receive a full copy of the forecasting report.

XpertHR Sheila Attwood,
Editor,
Pay and Benefits Bulletin

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  ANALYSIS

Pay awards drop further behind inflation

The median pay award has risen to 3.5% in the three months to the end of July, but the gap between pay settlements and retail prices index inflation has widened to 1.5 percentage points, according to the latest analysis of pay settlements from IRS.

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Public sector pay review bodies (3): senior salaries

We look at the recommendations of the Review Body on Senior Salaries and at parliamentary pay, as well as the Armed Forces' Pay Review Body supplementary report on the defence medical services.

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RELATED ARTICLES ON XPERTHR

Pay Intelligence August 2008

Public sector pay review bodies (1): discontent rumbles on

Public sector pay review bodies (2): the health professions

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  NEWS

Survey highlights legal sector pay inequality

The gender pay gap in the legal sector is 32%, according to a report from the Law Society.

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Salaries in electronics industry remain flat

The median basic salary across all ranks of electronics industry employees has barely changed from the median recorded a year ago, according to the latest annual survey from Croner Reward.

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Most EU employers think that pay should reflect ethical behaviour

More than two-thirds of European employers would like to see some of their employees' salary or bonus linked to "ethical behaviour", according to research from international risk management consultancy Integrity Interactive Europe.

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Graduate salaries rise by only 1.8% in 2008

Research from the Association of Graduate Recruiters finds that the median graduate starting salary in the year to June 2008 is just 1.8% higher than the median rate recorded one year previously, representing the lowest rate of growth since the survey began in 2000.

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Poor pensions knowledge abounds

A large proportion of the workforce still do not have a basic knowledge of pensions, according to a survey undertaken on behalf of the National Association of Pension Funds, as reported by Occupational Pensions.

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Easing the pressure: non-financial rewards

Pay deals are proving difficult to settle and budgets have been slashed, but there are still ways to reward your staff despite the credit crunch, says Personnel Today.

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The IRS graduate recruitment survey 2007/08

Official pay data: gender pay gap

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  PAY AWARDS

Pay reports recently added to the site:

Metropolitan Police: 2.5% pay increase

Scottish and Northern Irish plumbing industry: 4.6% rise in minimum hourly rates

Pay review update: 29 August 2008

The latest pay review update table contains pay settlements at the Department for Work and Pensions, Jarvis Rail, npower, the Royal Shakespeare Company, Scope, and many more.

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Pay Intelligence August 2008

Latest on pay awards, wage and salary levels

Official figures

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  DATAFILE

Statistics and forecasts

The datafile contains the most recent inflation, earnings and labour market statistics, pay settlement data and inflation and earnings forecasts collected by IRS. Our panel of City and academic forecasters expects headline inflation to peak at 4.7% in the third quarter of the year, but fall to 3.4% by the second quarter of 2009. Average earnings growth is expected to remain stable, averaging 4% in 2008 and 3.9% in 2009.

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Economic indicators

Statutory rates

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  MORE FROM IRS...

From the blog

Launched and run by the editorial team that produces XpertHR and the IRS e-journals, the Employment Intelligence blog is regularly updated with news, comment and links to the latest employment developments. Recent posts include:

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