A Bi-annual report* provides HR professionals with insights into current trends in the world of reward and benefits. The report is circulated to respondents to help them manage pay and reward practices.
Data was collected between March and May 2021 from 278 HR Professionals and Reward Practitioners – representing HR practices that affect over half a million employees.
Tim Kellett, Director at Paydata explains the key findings: “As the UK hopes to emerge from the upheavals of the last year and fully reopen with a revised date of 19 July following its strong rollout of the vaccination programme, organisations continue to remain agile.
During 2020, we captured the lowest levels of recruitment and retention difficulties that employers had experienced since the 2008 recession. Just as Chancellor Rishi Sunak’s March budget was focused on economic recovery and building back better, our spring 2021 survey captures the first signs of optimism about the labour market becoming increasingly buoyant over the next six months.
Pay levels have also taken a hit this year. Whilst 54 per cent have managed to avoid making redundancies after the turbulence experienced during the pandemic, the average pay award now lies below inflation, at two per cent. The temporary uplift in awards to three per cent was mainly due to the fact that the first lockdown came at a time when 56 per cent of respondents to our spring 2020 survey had already carried out their pay review and more generous awards had gone ahead.
11 per cent are operating a pay freeze, a decrease from 24 per cent in the autumn. For some, they may be facing the second consecutive year of a pay freeze. Combined with rising living costs, employers are acutely aware of the need to deliver value through reward schemes and recognise employees who have been through an extraordinary year.
The government suspended gender pay gap reporting for 2019/20 but reinstated the requirement for 2021, extending the deadline to October. 61 per cent of respondents measured the gap in 2020, despite not being required to report it – demonstrating the weight and analysis companies place in this governance requirement. Many are examining their wider record on equality and 85 per cent of respondents have diversity and inclusion initiatives in place.
The renewed focus on wellbeing is important not only for managing remote workforces but defining new ways of working as we emerge from the pandemic. So called ‘hybrid working’ will look different for each organisation, with only four per cent predicting a return to their previous way of working.”
* Data from Paydata