Bumper public sector pay rises at odds with freeze for private staff
ALMOST 100,000 private sector workers have suffered a pandemic pay freeze while public sector staff enjoy inflation-busting wage rises, figures show.
Rishi Sunak, the Chancellor, has gifted doctors, teachers and police big pay rises in recognition of their “vital contribution”, with teachers winning a 3.1pc deal despite the closure of schools since early March.
But figures from HR consultant XpertHR on 219 pay settlements at private companies employing 520,000 workers in the quarter to June show far lower median pay growth of just 2pc.
More than half of all private sector awards are below last year, with 99,000 employees at 50 firms told they will get no – meaning they are worse off in real terms despite inflation of just 0.6pc.
Sheila Attwood, of XpertHR, said that about a quarter of private firms usually covered by its survey had delayed pay settlements due to the outbreak. It means the present 2pc median pay is likely to fall further as support schemes such as the furlough are wound up.
“I suspect a lot of those companies will come back and say they are freezing pay,” she said. “Given the outlook for the remainder of the year in the private sector, I would be surprised if 2pc was the low point.”
Many companies have frozen recruitment, as well as pay reviews, as belts tighten. LinkedIn, the professional networking site, said it would reduce its headcount by about 960 due to difficulties posed by the pandemic.
The social media site, which is owned by Microsoft, said it was “not immune” to the effects of Covid-19 and that demand for its business continued to be impacted as fewer companies need to hire at the same volume.
The California-based firm offers a range of employment services but is largely known for being the modernday version of an online CV.
In a note to employees, LinkedIn chief executive Ryan Roslansky outlined the range of cuts being made across the business.
He said he wanted everyone to have the “complete picture” of the changes and insisted that the 960 roles were the “only layoffs we are planning”.