Three Quarters of Small Businesses Planning Employee Pay Rises in 2015
76% of small and mid-sized firms are optimistic about their business’ 2015 prospects
The majority of small and mid-sized firms (74%) believe that they will be able to offer employees pay rises next year, according to the latest Close Brothers Business Barometer (CBBB).
The quarterly survey, which gages the opinion of small business owners across a range of sectors, revealed of the businesses predicting wage increases, 36% will offer companywide rises and 39% will increase wages on merit.
76% of businesses are optimistic about the future with 41% predicting company expansion.
Business optimism appears to be nationwide. Whilst London and the South East came out highest in regards to the number of entrepreneurs predicting wage increases at 80% and 81% respectively; the lowest regions– East Anglia (65%) and Yorkshire & Humberside (67%) – were still relatively high with over half of companies intending to offer pay rises.
CEO of Close Brothers Asset Finance, Mike Randall, discussed the findings, warning firms to be careful:
“It’s encouraging that so many businesses across all regions 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 across the country, 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.”