There’s more bad news for the UK’s engineering and manufacturing sector. New figures from the Engineering Employers' Federation (EEF) show that the rise in pay settlements during the three months to the end of January 2003 showed a surprise fall of 0.1 per cent.
This is despite skill shortages in the sector and expectations that rapidly rising public sector pay would have a knock on effect.
During the three month period, pay settlements fell from 2.5 per cent to 2.4 per cent. For January 2003 alone, the average settlement for the 256 reported settlements was also 2.4 per cent.
"This slight fall in pay settlements reflects the continuing difficult economic environment in which many companies in the engineering and manufacturing sector are still operating,” said EEF Deputy Director of Employment Policy, David Yeandle.
“To date, there is no evidence that the higher pay settlements that have recently been awarded in parts of the public sector are having a knock on effect in this sector".
The figures are an important indicator as they include data for January 2003, the month historically when the largest number of settlements occur in engineering and manufacturing. The figures also tend to set the pattern of pay settlements in engineering and manufacturing for at least the first half of this year.
Over this three month period, the number of pay freezes fell slightly to around one in seven of all reported settlements and those companies reporting that they had deferred pay settlements fell slightly to just under eight per cent.