William Eichler 18 July 2023

Public sector pay increases do not add to inflation, think tank says

Public sector pay increases do not add to inflation, think tank says image
Image: Dilok Klaisataporn / Shutterstock.com.

Increasing pay for public sector workers by 10% would not add much to inflation, according to a new report by the think tank IPPR.

A 10.5% pay boost to restore real pay to 2019/20 levels would add at most 0.14 percentage points to inflation if funded by borrowing, the report said.

It also revealed that if an average public sector worker were to receive a pay award of around the 6% announced last week they would still be £1,400 worse off this year on average than just before the pandemic, because wages have not kept up with prices.

IPPR said that the decline in real-terms pay since 2010 had hit the living standards of public sector workers, and had also contributed to the recruitment and retention crisis that is undermining the quality of public services.

IPPR is calling for a 10.5% average uplift this year to restore public sector pay to 2019/20 levels, at an additional cost of £7.2bn beyond last week’s pay offers.

Joseph Evans, researcher at IPPR and one of the report’s authors, said: ‘It’s wrong to claim that giving the public sector a more meaningful pay rise will further embed inflation. Research shows that there is very little inflationary impact from a significant pay rise, but that the need to stop the fall in living standards for public sector workers is urgent.

‘Without an inflation-matching pay rise the public sector will continue to face a triple crisis of falling living standards, a recruitment emergency and declining quality of public services.’

SIGN UP
For your free daily news bulletin
Highways jobs

Team Manager - Family Support and Safeguarding

Oxfordshire County Council
£55,783 - £59,010
Join our dedicated team at OCC as a Team Manager! You will play a crucial role in ensuring that children, young people and families in need of help and protection receive timely, high quality assessments and support. Your efforts will help identify and me New Futures Centre, Hilton Road, Banbury
Recuriter: Oxfordshire County Council

Clerical Officer Receptionist

Durham County Council
Grade 3 £24,404 -£25,183
An exciting opportunity has arisen for a full time Temporary for 1 year Clerical Officer Receptionist.  You will provide a professional receptionist a Durham
Recuriter: Durham County Council

Clerical Officer Receptionist

Durham County Council
Grade 3 £24,404 - £25,183 Pro rata to hours worked
We have an exciting opportunity for a Clerical Officer / Receptionists to join our dedicated team within Business Services. 1 x Part Time Permanent Durham
Recuriter: Durham County Council

KS2 Class Teacher

Durham County Council
£31,650 - £43,607
Key Stage 2 Class Teacher M1 - M6  £31,650 - £43,607 Full Time, Whole Time Temporary – required from September 2025 until August 2026 The Governors o Durham
Recuriter: Durham County Council

Teaching Assistant

Durham County Council
£24,404 - £25,183 pro rata
Teaching Assistant Grade 3    £24,404 - £25,183 pro rata Permanent Full Time, Term Time Only + 2 Weeks Start Date
Recuriter: Durham County Council
Linkedin Banner