UK wages will continue to grow at a faster rate than prices, a management consultancy has forecast.
Employees can expect to see a 2.5 per cent rise in pay over 2015, Hay Group said today. Meanwhile, inflation – annual growth in prices – is forecast to be 1.7 per cent in 2015, according to Hay Group. This means “real” wages – the amount of goods and services that can be purchased with money wages – will rise 0.8 per cent.
Organisations in engineering-related sectors are forecasting larger increases, as the war for talent intensifies. Organisations in the chemical, oil and gas and manufacturing sectors are all predicting salary rises above the UK average, at three, 3.5 and three per cent respectively.
Retailers are forecasting salary rises at two per cent, while finance and utilities companies all mirror the UK average of 2.5 per cent. The government’s increase cap of one per cent continues to impact the combined public sector.
“The pay forecast implies optimism is returning to businesses as employers are anticipating salary increases above inflation,” said Adam Burden, consultant at Hay Group.