How Employers Are Viewing Wage Changes: The Latest Data


The CIPD is a central resource for a number of professions – not least one we work frequently with, Human Resources. Our online recruiting methods for this industry have resulted in proven and notable HR hires for global brands and PLCs. And the recruitment news just got even better.

HR, as the workplace centre for all things people – are a key part of any organisation. And the CIPD, as their governing body is hugely respected among peers. It conducted its most recent research into HR trends this summer, and covered in the final report was the all-important topic of pay and where employers are looking to go with salary increases and decreases in the coming months.

What’s Driving Pay Increases?

“The planned median basic pay increase over the 12 months to June 2017 is 1.1%, significantly less than the 1.7% planned in spring 2016 and the 2% planned in summer 2015.”

Source: CIPD, 2016

This may seem like negative news – and a planned drop might be due to economic developments, Brexit and other factors. However, the CIPD positively notes “remarkable consistency” over time, showing that pay is stable on the whole.

Upon researching the reasons resulting in this average increase and dividing between employers looking to up their salaries, and lower them, the below data was collated:

For organisations anticipating pay increases over 2%, the reasons cited are as follows;
• Ability to pay
• Pay rises elsewhere
• Recruitment and retention
• Improved productivity and performance
• Pay catch-up
• Increase in NMW in October 2016
• Current rate of inflation
• Increase in NLW in April 2016
• Anticipated rate of inflation
• Ripple effect of higher salaries

What’s Driving Pay Decreases?

For organisations anticipating pay increases under 2%, the reasons cited are as follows;

• Restraint on public sector pay

• Inability to pay

• National Living Wage

• Other non-wage labour costs

• Pension auto-enrolment

• Increase in NMW October 2016

• Wage movement elsewhere

• Apprenticeship levy

• Anticipated rate of inflation

• Current rate of inflation

How Recruitment Is P(l)aying Its Part in Anticipated Wage Increases

You’ll notice (as we did) that recruitment and retention are playing a part in wage increases over 2%. And by making the right hire you can increase retention, with good recruitment making that all the more likely to happen.

So for the field of HR, and those looking to enter in to it, strong recruitment can now be linked to better pay.

This positive correlation showing that companies are looking to up wages in part because of more effective recruitment and retention is music to our ears! Improving recruitment is one tool HR professionals have available to them in awarding pay increases to deserving employees over the coming months.