While Big Tech is frantically laying off the loyal staff that made them billions, British tech firms are finding it increasingly difficult to keep them, according to one study.
Employers are expected to raise wages for their staff by the most in at least 11 years, but the five per cent pay deals for workers would still fall well below expected inflation, a survey published on Monday showed.
The Bank of England has warned that the surge in inflation could be harder to tame if pay deals keep rising, the Chartered Institute of Personnel Development (CIPD) said 55 per cent of recruiters planned to lift base or variable pay this year as they struggle to hire and retain staff in Britain’s tight labour market.
Expected median annual pay awards in 2023 rose to five per cent – the highest since CIPD records began in 2012 – from four per cent in the previous three months.
More than half of respondents reported having problems filling vacancies, and nearly one in three expected similar issues in the next six months.
CIPD senior labour market economist Jon Boys said that skills and labour remain scarce in the face of a labour market which continues to be surprisingly buoyant given the economic backdrop of rising inflation and the associated cost-of-living crisis.
The survey also showed the gap between public and private employers’ wage expectations widened. Planned pay settlements in the public sector fell to two per cent from three per cent in the quarter before, compared to five per centin the private sector, the CIPD said.
BoE Governor Andrew Bailey last week expressed concerns about wage-setting, despite signs that the surge in inflation has turned a corner.
Annual inflation fell to 10.5 per cent in December after hitting a 41-year high of 11.1 per cent in October. Bailey signalled inflationary pressures were still a worry despite the BoE raising interest rates to the highest since 2008 this month.
The quarterly survey showed recruiters were more willing to hire people returning to the workforce, including older workers and those with health conditions.
