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Pay Rises Stall as Supply Outstrips Demand


Growth in average pay has dipped below cost of living as migrants and 'grey workers' boost labour supply, according to the Chartered Institute of Personnel and Development.

The latest Office for National Statistics (ONS) jobs figures showing a further rise in UK unemployment but moderation in average pay growth.

CIPD/KPMG’s quarterly Labour Market Outlook survey report states that pay pressures are not only subdued now but also likely to remain during the important winter pay round.

The CIPD's Chief Economist Dr John Philpott said: "The main underlying reason for this is the combination of high immigration and a rise in the number of home grown people entering the jobs market, especially the growing brigade of older workers, many above state pension age.”

Growth in regular pay (excluding bonuses) is said to be failing to keep up with the cost of living as measured by Retail Price Index (RPI) inflation

Philpott added that with such a strong supply of labour, employers were able to resist demands for higher pay.


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