In August, the Chartered Institute of Personnel and Development published the summer 2014 edition of its Labour Market Outlook survey. This showed that employment growth was buoyant in all sectors except the public sector – and, even here, reduction slowed.
The survey found that, so far in 2014, only 40 per cent of organisations had conducted pay reviews – suggesting that 60 per cent were expecting a pay freeze, because most pay awards take place in January or April. Those that did get an award (excluding bonuses) got 2 per cent on average in the private sector and 1 per cent in the not-for-profit sector. There has been no announcement yet about the National Joint Council cost-of-living award for 2014 – so public sector staff and those in the not-for-profit sector still tied to NJC rates will still be waiting. I will be astounded if it is more than 1 per cent.
However, pay in our sector is still depressed: only 13 per cent of organisations said they had increased starting salaries since 2013; 66 per cent said they had stayed the same, and 12 per cent said they had decreased. All wages are lagging behind inflation and have done since 2008, but the not-for-profit sector has lagged the most, with a pay gap of between 16 per cent and 21 per cent. This is why we don't feel better off, even though the downturn is supposedly over.
The survey showed that recruitment intentions in our sector also remained buoyant, with 77 per cent of organisations surveyed expecting to recruit. I do wonder, however, how much of this is long-term recruitment? I suspect many in our sector are looking at jobs that are fixed-term to March next year.
There is a general election next year, which means the political and economic environment remains uncertain. From what I've seen, however, none of the political parties particularly understands our sector or is likely to put anything in its manifesto based on what we can do for social welfare or community sustainability. The parties are certainly not interested in funding sector infrastructure organisations.
For those struggling to find money to increase salaries, the biggest factor in making pay decisions is recruitment – can you recruit staff with the skills and experience you need at the wages you are offering? If the answer is, broadly speaking, yes, you don't need to look at an overall salary increase. But if you're finding it hard to recruit and have a high staff turnover, you should be looking at what you can afford to do.
Whichever bit of the sector we are in, sustainability must be our watchword. If you can't afford an overall cost-of-living award, then look at whatever benefits you can provide to top up low wages. And if you are not paying the living wage in your area, then that should be your first point of attention.
Gill Taylor is a sector HR consultant