UK employees in line for a pay rise this year

Half (50%) of UK businesses are expecting to give their staff a pay rise of at least 2% in the next year, according to a survey by business organisation British Chambers of Commerce (BCC) and online recruitment company Indeed.

And for some employees, the news is even better - the survey, of over 1,000 businesses found that 6% of firms will increase pay by more than 5%, 32% by 2-5%, 12% in line with consumer price inflation, and 18% by 1-2%. Only 2% of firms say that they expect to decrease salaries.

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Jane Gratton, BCC Head of Business Environment and Skills Policy, said one reason why firms were keen to up their salaries was retention. “Our survey work has shown that growing and pervasive skills shortages are making it harder than ever for firms to fill job vacancies - so it is little surprise that they are pulling out all the stops to keep hold of the ones they have,” she said.

“But the rising cumulative cost-burden of employment, together with business rates and other charges, increases pressure on firms to raise prices and automate. To avoid future job losses, the government must avoid any additional costs on business and help firms to boost productivity, for example by making it easier for firms to use the apprenticeship levy to upskill their staff.”