Employers in the UK expect wage growth to remain weak, a survey of personnel managers said yesterday, a contrast with other reports that said salaries are set to rise at a faster pace.
The report from the Chartered Institute of Personnel and Development (CIPD) showed private sector median wage settlements in the year to June next year are expected to be 2 percent. They were 2.5 percent last year.
Economists polled by Reuters expect inflation to average just below the Bank of England’s 2 percent target until midway through next year, meaning wage settlements would barely rise in real terms, the CIPD’s survey said.
A survey last month from the Institute of Directors showed two-thirds of company bosses intended to hike staff pay at least in line with inflation over the next 12 months.
Still, the CIPD survey showed recruitment intentions were high across the UK.
“This is great news for job seekers, but we urgently need to see jobs growth accompanied by productivity growth for workers to feel the benefits of the recovery too,” CIPD chief economist Mark Beatson said.
Output per hour worked, one measure of labor productivity, is still around 4 percent weaker than its pre-recession level.
The survey also showed only 2 percent of employers increased their starting salaries significantly in the past 12 months — in stark contrast to a report on Friday last week from the Recruitment and Employers Confederation, which pointed to surging starting salaries.
The CIPD said some business surveys were not picking up the large number of employers that are not carrying out pay reviews, or are implementing pay freezes.
Only 38 percent of employers polled had carried out a pay review since the start of this year, a figure the CIPD said was “surprisingly low” since most pay settlements take place during the first half of the year.
Regular pay for employees grew by 0.7 percent in the three months to May, according to the Uk’s Office for National Statistics. That was less than half the rate of inflation and the slowest growth in regular pay since records began in 2001.
Weak wage growth is the most compelling evidence that the UK’s economy is still operating well below its full capacity, and that inflation is no danger despite strong growth and a record number of people in work.
CIPD’s quarterly net employment balance, which measures the difference between employers intending to hire staff and those planning to cut, fell slightly to plus 23 from plus 26 in May’s report.
A separate report released yesterday from recruitment agency Reed showed vacancies for part-time jobs has surged over the past year, driven by manufacturing, retail and construction.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to