Pay rises are heading for the highest in a decade

UK employers have offered staff the biggest pay rises in 10 years, as the first increases of 2019 moves in a ‘positive direction’, according to a report.

Research suggested the annual wage deals agreed in January was 2.8%, above the 2.5% in most of 2018, according to pay analyst XpertHR.

Median rises in the final three months of last year were 2%, with just over half the same as the previous year, the study indicated.

XpertHR pay and benefits editor Sheila Attwood said: ‘The 2018 calendar year brought good news for employees as pay awards moved up from 2% in 2017 to 2.5% over the year as a whole.

‘Despite the uncertainty surrounding Brexit outcomes, the first pay awards of 2019 are moving in a very positive direction, with the provisional 2.8% median the highest figure we have recorded since December 2008.’

This comes after figures showed a record number of people are in work, with job vacancies are at their joint highest level since 2001.

Average earnings increased by 3.4% in the year to November, the highest for a decade, outpacing inflation.

Employment increased by 141,000 in the three months to November to 32.5 million, the highest since records began in 1971.

Unemployment also increased, up by 8,000 to 1.37 million, although the total is 68,000 lower than a year ago, said the Office for National Statistics (ONS).

The UK’s jobless rate is now 4%, down by 0.2% on a year ago, and the lowest since 1975.

The ONS said average weekly earnings, adjusted for price inflation, increased by 1.2%, including bonuses, compared with a year earlier.

The increase in both unemployment and employment is explained by the UK’s rising population, and fewer people classed as economically inactive, which includes those on long-term sick leave, students, and people who have given up looking for a job.