ONS stats show first real pay rise in six years but progress on pay and gender pay gap remains slow
Commenting on the Annual Survey of Hours and Earnings, from the ONS, Charles Cotton, pay and reward adviser at the CIPD, the professional body for HR and people development, comments:
On the first real pay rise in six years:
“Finally, these figures show the first real pay rise for six years, however this is more because of low inflation and not as a result of significant pay growth. The pressure to raise wages in the near-term remains subdued for many employers, as the rate of earnings growth continues to comfortably exceed inflation and because, outside a few sectors, skills shortages remain limited.
“Today’s earnings’ growth figure of 1.9% sits firmly in the centre of the CIPD’s pay projections for the past year and we expect this picture to remain fairly stable for the next year. Until we see gains in productivity, people are unlikely to feel the benefit in their pay packets so businesses need to concentrate on better people management and better working practices to shift the dial on this.”
On the public sector:
“The public sector pay boost may surprise some, particularly give the 1% pay ceiling in force, but the public sector is getting smaller and it’s lower grade, lower paid jobs that have disappeared the most. This will have pushed up average earnings in the public sector, even if the entire workforce was only receiving a pay increase of 1%. Productivity increases tend to drive out more low paid jobs than high paid jobs in the private and public sectors.”
On the gender pay gap:
“While there has been a small drop in the gender pay gap for full-time staff, the pay gap has changed little over the last four years. Much more needs to be done to address the barriers that prevent women remaining on the career track to the top and in encouraging and supporting more women to enter traditionally male dominated sectors such as manufacturing and construction as well as more men entering female dominated professions such as primary school teaching. We need to see better links between education and business, more inclusive recruitment practices, and greater use of mentoring to help women make the step up to the most senior levels in business.
“But top priority should be given to encouragement of more flexible working opportunities that make effective use of skills and provide opportunities for progression – this is what’s needed to stop the massive widening in the pay gap we see for women during their 30s. The figures also highlights the importance of childcare provision for workers given that the gender pay gap is so large for women in their 40s and beyond.”