Almost three-quarters of small- and medium-sized manufacturing firms plan to give their employees a pay rise in the next 12 months, according to a recent survey.* Of that number, over a third say that everyone will receive a rise while 38% say the increases will be decided on merit.
The figures come from the most recent Close Brothers Business Barometer, a quarterly survey that canvasses the opinion of SME owners and senior management from a range of sectors across the UK on a number of financial and economic issues.
Steve Gee, managing director of the manufacturing division at Close Brothers Asset Finance states: “It’s encouraging that so many manufacturers appear to be optimistic and in a financial position to reward their employees with an increased pay packet.
“While on the surface this is good news for workers in the industry, we should be aware that the Bank of England is watching pay closely, as an indicator of when the right time will be to increase interest rates.
They’ve also warned that unless wage increases are accompanied by a rise in productivity then they will have to move more quickly on rates as inflationary pressure mounts,” he adds.
The business barometer also revealed that 74% of manufacturing business owners surveyed are optimistic about their prospects for the year ahead, with 43% confident that their business will expand during 2015.
*All figures, unless otherwise stated, are from a GMI survey conducted in September 2014. The survey canvassed the opinion of over 700 SME owners across the UK and across several industries on a range of issues affecting their businesses. This survey was conducted online.