Socialist Worker

Revolt against below-inflation deals starts to get results

Issue No. 2064

Gordon Brown’s attempts to limit public sector pay are being echoed by bosses in the private sector, who are desperate to increase their profits at the expense of workers.

Across the whole of the private sector this year the median (average) settlement was just 3.5 percent.

But there is a growing resistance, with private sector pay deals in more strongly unionised industries outstripping those in the public sector.

Pay deals in the manufacturing and production are rising.

The median pay rise in this sector reached 4 percent for the three months to the end of July 2007 – meaning half of the pay settlements were above 4 percent and half were below. This figure is up from 3.9 percent in the previous three month period and 3.7 percent for the three months before that.

The chemicals, pharmaceuticals and oil industry is one of the main sectors responsible for keeping the manufacturing and production median high.

Over the last year only six out of 75 pay deals monitored by Income Data Services (IDS) in the chemicals sector have been below 3 percent.

Increases in the sector include 4.3 percent at L’Oreal, from 1 July 2007 and 4 percent at Kemira Growhow from 1 May 2007.

Overall earnings growth for this sector is at 4.6 percent according to the latest figures.

The median for the whole economy, for the three months to the end of July 2007, is holding steady at 3.5 percent. It has been running at this level since November 2006.

The latest figure is based on 53 settlements covering over 1.1 million employees. The IDS figures show that 3 to 4.1 percent is the main range for pay deals.

The BBC has agreed a 4 percent rise in basic pay. The universities sector paid 3 percent to all staff from 1 August 2007 in the first stage of the second year of a three-year deal.

The biggest annual increase was a 7.9 percent rise for 600 workers at the Drax power station in Yorkshire.

Other notable increases this year include a 5.35 percent pay rise for 10,000 Network Rail workers and a 4.7 per cent increase for 60,000 BT staff.

It is not all onwards and upwards though. Waterstone’s paid just 2.5 percent to its book store staff. In general there are lower deals in the retail and catering sectors.

Where unions are organised and fighting they get decent pay.

Public sector average earnings, excluding bonuses have had higher rises in recent years than the private sector.

The trend, however, has been reversed recently as Brown has fought to keep public sector pay down.


Construction sites across the country are facing strike action over pay.

A deal was agreed between the employers and Unite union leaders in April, but was rejected by union stewards for being too low.

A wage agreement for 2008-11 was signed in April between employers and the union leaders, but was again rejected by an ballot.

The Joint Industry Board (JIB) had proposed a 14.8 percent pay rise over three years – 4.67 percent this year, 4.5 percent next year and 5 percent the year after.

Last month Unite stewards rejected yet another JIB proposal.

The union is now preparing to vote on strike action if a wage increase is not agreed.

The employers claim that the Unite union’s stewards had made “a mockery of the national wage bargaining process”.

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Article information

Tue 14 Aug 2007, 18:05 BST
Issue No. 2064
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