Nearly 80pc of firms set to raise pay this year
Almost 80pc of Irish businesses expect to dish out pay rises for workers this year as the economic recovery gains pace, according to a new survey.
Data from PricewaterhouseCoopers' (PWC) Reward Trend Snapshot survey shows that 78pc of firms plan pay increases in 2015, with 88pc expecting to do so in 2016. Just 64pc of Irish companies surveyed last year expected to increase worker pay during 2014.
Just 22pc of companies are applying pay freezes this year, with the figure expected to tumble to 12pc in 2016, according to the findings.
Where companies have already pencilled in wage increases for 2015, the average rise will be about 2pc and 2.1pc in 2016. Half the companies in the survey expect any pay increases they offer to staff to be between 2pc and 3pc.
Figures from the Central Statistics Office last week showed that average weekly earnings are rising across a range of sectors. Weekly earnings were €704.34 in the last quarter of 2014, up 2.3pc in the corresponding quarter in 2013 and the highest since 2010.
The financial, insurance and property sectors have recorded the biggest increases.
Manufacturing data yesterday showed that the sector expanded at its fastest rate in 15 years.
All that positive performance is slowly feeding into workers' pay packets and demands.
In January, trade union SIPTU called for 5pc pay increases across the public and private sector and for the minimum wage to be raised to €11.45 an hour.
A sharp fall in oil prices pushed Ireland's inflation rate down 0.6pc in January compared to January 2014. But while the price of oil tumbled, the cost of renting rose 7.9pc, and the price of gas climbed 1.1pc. Childcare costs also increased.
The PWC survey shows that individual performance remains the driver in 80pc of salary increases that are awarded.
But external benchmarking is also used in 74pc of cases, while company performance is taken into account in 72pc of instances where pay rises are awarded.