Pay settlement values continue to fall as more employers freeze pay

The latest figures from the IDS Pay Databank show the lower quartile - which a quarter of pay settlements are below - dropped from 2% from 2.8% since February, while the upper quartile fell from 4% to 3.8%.

In April alone, a third of pay settlements monitored by the IDS were pay freezes. Compared with 2008, the amount of pay freezes has increased from less than 1% in 2008, to 25% this year.

Ken Mulkearn, editor of IDS Pay Report, said: "Sometimes summary statistics don't tell the whole story and this is one of those periods when the broader picture is just as important. On the one hand, those firms most affected by the recession are freezing or pausing pay.

"On the other hand, a significant proportion of companies are continuing to pay increases, mainly in the 3% to 4% bracket. And the tale is largely one of contrasting sectoral fortunes, with most of the freezes concentrated in engineering and among firms, which provide key industrial inputs, such as chemicals manufacturers.

"By contrast, other sectors, like food manufacturing, pharmaceuticals and retail, have seen fewer freezes."