FILE PHOTO: A woman walks through the financial district in the City of London, following the outbreak of the coronavirus disease (COVID-19), in London, Britain July 13, 2020. REUTERS/Toby Melville
LONDON (Reuters) – British private-sector employers have slashed their annual pay awards to staff, offering the lowest increase in 10 years as they grapple with the hit from the coronavirus pandemic, a survey showed on Thursday.
Human resources data provider XpertHR said pay deals in the three months to July offered a median annual pay rise of 0.5%, down from 2.2% in the previous three readings. Pay freezes accounted for more than four in 10 settlements.
The latest three-month period covered a typically quiet time of the year for pay deals.
Looking at 2020 so far, and including the public sector, the median basic pay settlement was worth 2.2%, down from 2.5% over the year to December 2019.
“The drop in the value of pay awards comes as no surprise, as the number of pay freezes made by organisations begins to creep up,” XpertHR pay and benefits editor Sheila Attwood said.
“We also expect many of the pay reviews currently on hold to ultimately result in a pay freeze for staff, making 2020 the worst year for pay awards since 2009.”
Around 750,000 jobs in Britain have been lost since the start of the coronavirus pandemic and the Bank of England expects the unemployment rate to nearly double to 7.5% by the end of the year.
Reporting by William Schomberg, editing by David Milliken