On average, workers expect an uplift of 5.6%, lower than the global average of 8.3%.
Only 12% of workers are expecting to get a pay rise of 10% or more, meaning the majority of workers are not expecting pay rises in line with current levels of inflation.
Sirsha Haldar, general manager at ADP UK, said employers need to balance pay expectations against their own challenges around rising costs and tightening profit margins.
Speaking to HR magazine, he said: “Workers are confident that they will get a pay rise from their current company – but if not, there’s a strong sense that they’ll be able to secure one by moving jobs. The implications for talent acquisition and retention are huge.”
More on pay rises:
The findings come as workers in the UK demonstrate a willingness to take industrial action to force their employers to be more generous on pay and conditions including nurses, rail workers, junior doctors and teachers.
The study found 54% think they are underpaid for their job.
Zofia Bajorek, senior research fellow at the Institute for Employment Studies, said the increase in pay expectations was unsurprising.
Speaking to HR magazine, she said: “With the current cost of living crisis, and employees concerned about their financial wellbeing, it is unsurprising that UK workers are more focused than ever on their levels of pay and may start to use this as bargaining power.”
Haldar said taking a real-terms pay cut will be hugely detrimental to employee morale.
He said: “There’s no doubt the rising cost of living and inflation is having a huge impact on the UK workforce.
“It’s important for businesses to acknowledge these challenges with their staff and look at other ways to help staff with their finances.
“Whether they consider bringing in more frequent payment cycles to ease the cashflow burden or allow staff to work from home more regularly to reduce commute costs, there are simple ways organisations can boost their staff’s pay packet in real terms, and in turn, boost employees’ morale.”
Bajorek said that employers must improve their wider offer and benefits package in order to ease recruitment and retention issues.
She said: “Now maybe more than ever, a focus on good work, including job design, training and development, support, wellbeing benefits, autonomy and flexibility can be important benefits to promote.
“Organisations could make better use of progression in employment so that employees don’t feel that their skills are being under-utilised, and that they still have an important role in organisations.”
Bajorek said HR teams must focus on communication when it comes to negotiating pay expectations.
She said: “It is important that organisations understand the needs of their employees, and are honest about what they are and aren’t able to provide, but focusing on good work may help organisations stand in good stead throughout this period of uncertain pay expectations.”