Higher inflation is key to wage rises

Jan 4 2008 by Andrew Mernin, The Journal

HIGHER inflation has helped the size of the average pay rise to grow in recent weeks. Research by pay analyst Incomes Data Services (IDS) showed average pay rises grew 4% in recent weeks, up 0.6% on last month.

The report said last November’s 4.3% retail prices index triggered a number of high-level wage increases in long-term pay deals.

Network Rail paid 4.8% to around 7,500 maintenance workers on January 1, while 40,000 electricians received a 4% increase.

Inflation-linked pay rises, together with the higher increases awarded from last November in sectors such as the motor industry, explained the rise in the rolling three-month average figure from 3.4% in December to 4% in the three months to the end of this month.

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