At last! pay rise joy for millions

MILLIONS of British workers are set for a double pay boost with many seeing their wages rise as soon as this weekend, experts said yesterday. As many as 900,000 staff will receive a pay rise from Saturday when the minimum wage tops £6 an hour for the first time. In a move expected to benefit mainly female employees who are more likely to be on lower wages or on part-time contracts, the adult rate goes up by 15p to £6.08 an hour. Younger workers, aged 18 to 20, get a 6p rise to £4.98 and it goes up by 4p to £3.68 for 16 and 17-year-olds, while the apprentice rate rises by 10p to £2.60. And in another boost, cash-strapped workers could see more generous salary increases next year, a survey of employers showed. A third of employers plan to offer higher pay rises next year than they did in 2011, while more than half intend to give the same amount as they did this year. The level of pay awards could be slightly higher in 2012. Most were higher this year than last with pay freezes falling to their lowest since the end of 2008.The move to increase pay is a huge relief for the country’s cash-strapped workers. The soaring cost of living is making life very difficult, with record fuel bills, rising energy bills and target-busting inflation. Daniel Callaghan, founder of recruitment firm MBA & Company, said: “With pay rises, it’s all about striking a balance. The pay rises a company gives will naturally reflect its financial position, but if it can give a rise, however small, this will be vital fuel for the economy.” Unite general secretary Len McCluskey said: “When workers’ wages suffer, the entire economy suffers. Household incomes are under the biggest squeeze in generations. Fuel prices, food, travel – costs are all going up.“Workers need a little bit more in their pay packet to make ends meet. They have had year upon year of little or no pay growth.” TUC general secretary Brendan Barber said: “A real increase in wages in the public and private sector is in everyone’s interest.” But with the economic outlook remaining uncertain, the “tough” climate around wages will stay, according to research by pay analysts IDS. Ken Mulkearn, of IDS, said: “Going into 2012, there are conflicting pressures on pay. If the recession recedes, there may be pressure for higher awards, particularly at firms where increases were lower or zero. “While some firms may be able to award increases in line with inflation, most will have to be inventive in designing reward packages that achieve the aim of recruiting, retaining and motivating staff.” The cost of living will play a key role in shaping the pay expectations of workers, said IDS, as well as the “fragility” of the jobs market. A study of 60 settlements in the three months to August showed just one pay freeze in the private sector and three in the public sector. TUC general secretary Brendan Barber said: “While pay restraint could ease slightly in some industries, wages are likely to continue to trail rising prices and further squeeze living standards. Hard-pressed families are set for another tough year in 2012.” The TUC said estimates suggested that the 2.5 per cent increase in the adult minimum wage should benefit the public finances by £230million as tax and national insurance rates increase and the benefits bill falls. Unions are pressing the Low Pay Commission to be “bolder” in recommending next year’s rise, with some leaders believing a “living wage” of more than £8 an hour is needed.