Rising inflation and chronic staff shortages have forced Currys to become the latest major retailer to repeatedly raise wages, with workers being offered a third raise in 13 months amid the livelihood crisis.
The electronics retailer said it was taking action to attract and retain staff as companies across the UK struggle to find enough workers to fill a record number of positions. Effective October 30, base pay will increase by 3.5% to a minimum of £10.35 per hour, or £11.43 in London.
More than 10,000 workers are expected to benefit from the decision, which comes just a month after an earlier increase went into effect. Along with a pay rise 13 months ago, the company said base hourly wages rose 15.6% in just over a year.
Inflation rose above 10% earlier this year for the first time since 1982 as sky-high energy prices and the rising cost of a weekly grocery store put intense pressure on workers and families. Currys’ decision comes after a review by a “cost of living group” set up by the retailer earlier this year and made up of senior executives from across the company.
Currys’ move to increase wages several times over the course of a year follows similar decisions taken by other high-street companies struggling to hire workers as rising inflation and a smaller workforce in the UK after the Covid pandemic and Brexit are taking their toll.
Bank of England Governor Andrew Bailey has warned of large wage increases that could lead to inflation ’embedding’ itself in the economy via a wage-price spiral in which higher wages and higher prices fuel each other.
But unions have dismissed the argument as “a call for a nationwide pay cut,” while demanding bosses are showing restraint when it comes to executive salaries and profit margins.
This month Sainsbury’s said its 127,000 hourly-paid workers would receive a raise of 25p an hour to £10.25 from October, the second pay rise in a year, with the rate for staff in London shops rising from £11.05 £11.30 would rise. Aldi, Tesco, Asda, Marks & Spencer and Pret a Manger have also increased their pay rates twice a year.
While some employers are raising wages, official figures show that average wage growth is still lagging behind inflation. Annual growth in regular wages was 5.5% in the three months to June — stronger than before the pandemic as companies scramble for employees, but still well below inflation of nearly 10%.
Currys said “the current economic climate and feedback from colleagues” led to the additional pay rise ahead of the regular spring pay review, the results of which workers normally receive in August.
Group Chief Executive Alex Baldock said: “I hear every day from colleagues who are feeling the impact of the rising cost of living and we are committed to doing whatever we can to help.”
The company offers between 3% and 5% off shopping at major grocers like Asda, Morrisons and Sainsbury’s each week, as well as free budgeting advice.
While the new wage rate is higher than the legal minimum set by the government – £9.50 an hour for workers aged 23 and over – it remains below the “real living wage” of £10.90 an hour across the UK and 11, £95 in London from 11,000 employers accredited by the Living Wage Foundation charity.
The foundation launched its annual living wage increase two months ahead of schedule last week. She recommended the largest single hike yet, recognizing the severe pressure on households from skyrocketing energy prices and the highest rate of inflation in 40 years.
Last week, Lidl and Marks & Spencer increased hourly wages in a sign of pressure on companies to attract and retain employees. Lidl rose to the top of the retail wage league by raising entry-level hourly rates from £10.10 to £10.90 outside London and from £11.30 to £11.95 within the M25, which circles the capital. However, the wage for an eight-hour shift is just 50p more than competitor Aldi, which pays statutory breaks.
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