UK Employers' Pay Awards Plateau at 3%

Pay settlements by British employers have slowed down, according to data from human resources firm Brightmine. The median pay award was revised down to 3% from 3.2% in the three months to July and remained at that level in the three months to August. This slowdown is a sign of a softer labour market, with businesses citing higher employment costs and tighter budgets as reasons for their decisions.

Sheila Attwood, Brightmine's HR insights and data lead, said pay awards remain stagnant, with little reason to shift significantly in the medium term. The data is likely to offer some reassurance to Bank of England officials about domestic inflation pressures ahead of a potential interest rate hike in November.

Brightmine reported that 71% of pay awards were clustered between 3% and 4%. Employers are forecasting median pay awards of 3% for the year ahead, compared with realised awards of 3.2% for the year to August 31.