Britons set to secure a 3% pay rise in 2022 – ‘a positive outlook!’

Kay Burley grills Paul Scully on public sector pay rises

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A pay rise is something many Britons will look forward to, as they will get paid more for doing their job. As business confidence improves and the country begins to emerge from COVID-19, UK employees are set to receive a boost. It is expected people will receive a real-terms salary increase of 0.4 percent after inflation in 2022.

This will calculate as approximately £127 per annum before tax is taken into account.

This is according to the latest Salary Trends Report undertaken by data organisation ECA International.

This follows a 2.4 percent pay increase in 2021, despite the 1.3 percent increase originally forecasted by employers back in 2020.

Oliver Browne, Remuneration Manager at ECA International, commented on the matter.

He said: “Our survey indicates a positive outlook overall from employers, who have raised salaries more this year than they anticipated a year ago and are expecting to increase again next year. 

“However, uncertainty remains as we continue to live with the pandemic, increased energy costs and supply chain issues that could impact businesses and employees in the year ahead.

“How salary increases affect the pockets of employees is dependent on how inflation changes over the next twelve months. 

“The current forecast from IMF indicates the average real increase across Europe will likely be 0.9 percent, but this is dependent on inflation falling in the region next year. 

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“In the UK, at 2.6 percent inflation is expected to be higher next year, cancelling out much of the three percent salary increase that is anticipated for workers.”

Pay freezes have also impacted individuals in negative ways, however, these may be a thing of the past.

According to the analysis, there is a more optimistic outlook for 2022 across the UK and Europe.

Some 16 percent of UK companies initiated a pay freeze this year, and this was down from 35 percent in 2020.

This is better than first anticipated, as 25 percent of employers surveyed last year expected to freeze salaries in 2021. 

Mr Browne continued: “The successful COVID-19 vaccination rollout across the UK and other rich nations played a major role in boosting business confidence.

“Productivity and was a contributing factor in more companies awarding pay rises this year who had not expected to. 

“With rising confidence and spiking inflation just four percent of UK businesses expect to freeze pay in 2022.”

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The news on pay rises comes as more than 300,000 workers will see an hourly pay rise to £9.90 an hour from this week.

Firms signed up to the voluntary Real Living Wage will see their employees benefit from a rise of 40p to the new sum per hour.

Those Real Living Wage employers in London – within the M25 – will have a rise of 20p to £11.05 per hour.

The Real Living Wage is separate to the mandatory National Living Wage, and factors in issues such as inflation when deciding how much to pay workers. 

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