Pay freezes for employees 'to become commonplace'

17/04/2009

Major new analysis from the Hay Group shows that salaries are not set to grow by much in Britain, due to the downturn.

According to the firm, "cutting costs" is a priority among employers at the moment, as the recession squeezes profits.

The Hay Group study showed that the typical pay rise in the UK would reach just 1.5 per cent in 2009.

This would be among the lowest rates of increase in the world.

Hay also showed that around one in three organisations would be taking still more radical steps, by reducing staff numbers and freezing pay entirely.

Simon Garret, director of UK executive reward at Hay Group, said: "We are being hit worse than some of the other countries we've examined, in terms of the depth of the recession. And also it may be to do with our employment legislation.

"We are as an economy cutting costs when it's possible to do so and freezing pay is obviously one way of doing that. But I must emphasise that it's speculation and not data led."

Employment group Monster published a new poll earlier this week, showing that almost half (44 per cent) of Britain's workers were not expecting a pay rise this year.

Tags; Income Worries and Debt, Young Family Finances, Recent Graduate Debt,

• Share
• 
• 
• Store
• 
• Follow
•