According to new research by XpertHR, pay awards have stabilised for the first time in two years.

New data released by XpertHR indicates that, in the three months to August 2021, the median basic pay increase sits around 2 per cent which now appears to be the new normal.

This is compared to just a year ago where the median pay award dipped to zero with many companies choosing to implement pay freezes instead.

However, progress appears to have been made with the majority of pay deals (61.5 per cent) now being higher than employees received in 2020 while 15.4 per cent were rewarded the same increase.

Pay awards in the private sector rose marginally over the month of August to 1.6 per cent. However, a full recovery has not yet been made with figures down by 0.4 percentage points below the 2 per cent recorded for the year to the end of August 2020.

However, pay awards in the public sector have fared better, settling at 2 per cent in the year to the end of August 2021. This too, however, was down compared with 2.5 per cent in the year to the end of August 2020.

The manufacturing-and-production sector is currently recording pay deals just ahead of those in services.

However, previous research indicated that the services sector was faring well, with the median pay award to the end of July sitting at 2 per cent. However, the vast majority (63 per cent) of pay awards in this sector were shown to worth this or more.

Sheila Attwood, XpertHR pay and benefits editor, stated:

It’s been a turbulent time for pay setters, with last year employers postponing April 2020 pay reviews until later in the year – and in many cases then abandoning any increase altogether.

Now, pay freezes are becoming much less common in the pay scene but are still evident, as shown in the data. Pay rises never fully recovered last year, but after a slow start at the beginning of this year, levels are now holding up.

*To obtain this information, XpertHR has collected details of 102 pay settlements effective in the three months to the end of August 2021, covering more than 1.2 million employees.





Monica Sharma is an English Literature graduate from the University of Warwick. As Editor for HRreview, her particular interests in HR include issues concerning diversity, employment law and wellbeing in the workplace. Alongside this, she has written for student publications in both England and Canada. Monica has also presented her academic work concerning the relationship between legal systems, sexual harassment and racism at a university conference at the University of Western Ontario, Canada.