As the second half of 2023 looms, UK workers from all sectors are keen to gain insight into their financial future. With economic recovery steadily taking root post-pandemic, the question on everyone’s lips is: “What kind of pay rise can we expect to keep pace with the cost of living increases?”
It is predicted that a pay rise will indeed be the agenda for change in 2023, but the extent of that rise remains a topic of robust debate.
Considering the Office for National Statistics’ recent report for 2023, experts suggest that workers should anticipate a pay rise around the same to match the increase in the cost of living. However, considering the past years of economic turbulence, it is not a straightforward case of matching rates.
The Workers Union, argues for a more substantial increase. It stated “Inflation is just one small cog in the engine of the economy. Workers must also contend with increases in utility bills, rental costs, and transport fares. These are all running well above inflation. To genuinely ensure that workers’ standard of living does not decline, we would like to see a minimum pay rise of 4-5% across all sectors.”
The Federation of Small Businesses (FSB) has responded, emphasising the challenges small businesses face in these uncertain economic times. The FSB’s spokesperson said, “While we understand and sympathise with the cost of living pressures workers face, small businesses are also navigating a landscape of increased operational costs. We need a balanced approach that recognises these dual pressures.”
On the other hand, larger corporations have more room to accommodate significant pay rises. Several big names, such as Tesco and Unilever, have already pledged to increase wages for their workforce in the upcoming year, signalling a potentially positive trend.
Additionally, sectors like healthcare, public services, and technology, which experienced increased demand during the pandemic, might witness more significant pay rises. As the government prioritises the rejuvenation of the public sector and digital transformation, those employed in these sectors may expect a more substantial increment.
Economist Dr. Laura Davies suggests, “It’s likely to be a year of negotiation and nuance. Pay rises won’t be one-size-fits-all. While it’s important to advocate for workers’ rights and ensure they’re not left worse off due to inflation, businesses also need to navigate the turbulent economic waters and ensure their survival.”
The Workers Union says…
“So to conclude, a pay rise in 2023 seems inevitable to keep up with the cost of living. However, the exact percentage of this increment remains uncertain and will depend on various factors, including the sector, business size, and ongoing economic recovery. As we enter the second half of 2023, these discussions will take centre stage, shaping the financial futures of workers across the UK.”