January 2013 pay awards have risen slightly compared to pay awards at the end of 2012, but this could just be a 'beginning of year bounce', according to the latest data from pay analysts XpertHR.
During both 2011 and 2012 pay awards rose in January but then slipped back down again, a pattern we may be seeing repeating itself in 2013.
XpertHR has collected details of 60 pay awards effective in January 2013. Among this sample, the median pay increase was 2.5%. Half of all pay rises were worth between 1.5% and 2.8%.
Pay awards in the three months to the end of December 2012 were recorded at a median 2%, unchanged on the three months to the end of November. Half of all pay awards were worth between 1% and 2.5%.
The sample of January pay deals is made up entirely of private sector pay awards, as no public-sector organisations settle their pay awards at this time of year. In April, when many public-sector pay settlements take effect, we may see the overall level of pay awards dip.
Pay rises continue to lie well below the prevailing level of inflation, as measured by the retail prices index (RPI). The RPI remains the most commonly used benchmark for pay awards, and has consistently out-paced pay awards over the past few years.
XpertHR predicts that private sector pay awards will be in the region of 2.5% over 2013 while inflation is expected to average 2.9%, leaving employees out-of-pocket for at least another year.
"For the past two years pay settlements in January have been higher than over the remainder of the year, and it looks like 2013 may follow the same pattern. However, for employees any higher increases are likely to still fall short of the increase in prices."