Monday 19 February 2018

Pay rises for first time in four years as economy grows

Pay rises for first time in four years as economy grows
Pay rises for first time in four years as economy grows
Thomas Molloy

Thomas Molloy

Salaries are rising in most sectors but those working in the financial sector, construction and large companies are seeing the biggest gains, according to new figures from the Central Statistics Office.

The first salary increases in at least four years are a sure sign the economy is gathering steam and those improvements are finally trickling down to the general population.

The main reasons behind the higher wages are a slight increase in working hours as well as better pay for every hour worked.

Weekly earnings were €704.34 in the last quarter of 2014. That was a 2.3pc increase on the €688.78 earned in the same quarter a year earlier and the highest level since at least 2010. Salaries in the third quarter fell compared with the same period a year earlier.

Average hourly earnings were €22.11 in the fourth quarter.

The increase in wages was seen in nine of the 13 sectors tracked by the CSO. The largest percentage increase was recorded in the financial, insurance and real estate activities sector where weekly salaries soared more than 9pc from €976.15 to €1,069.56. One reason for rising pay was an increase in the number of hours worked. Another reason was what the CSO calls "irregular hourly earnings" in the sector, as banks and other financial services companies began paying bonuses again.

The largest annual percentage increase in 2014 was in construction.

The news was bad for people in small companies. Firms employing fewer than 250 people did not see pay increases while large firms did, the CSO said.

Most salary specialists expect pay to rise again this year. A recent report by remuneration specialists Hay Group predicted an increase of 1.4pc in salaries in 2015. "We are now seeing employers committed to increasing pay in the coming year," said Hay's Tom Walsh. "While a 1.1pc increase in real terms may not seem a significant increase, it does signify a change in attitude towards pay."

The CSO said the worst sectoral decrease was recorded in the professional, scientific and technical activities sector, which saw weekly earnings fall 3.6pc to €787.51.

Weekly average earnings in the private sector showed an increase of 3pc to €643.44 but the public sector (including semi-states) only rose 0.3pc to €910.87. The salaries do not include pensions; making direct comparisons difficult.

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