Is It Time to Ask for a Pay Rise?

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Improved Economy, Greater Job Opportunities: Is It Time to Ask for a Pay Rise?

The economy is on the mend, vacancies are on the rise, and employees have more options than they’ve had in years. But with interest rates set to climb and inflation ticking up, many are wondering: should I ask for a pay rise?

Economic Context

During the recession, redundancies, pay freezes, and scarce job openings were the norm. Coupled with rising living costs, one third of workers who remained in the same role throughout 2010 and 2011 experienced wage cuts or freezes, according to the Institute for Fiscal Studies.

Recently, the UK economy grew by 0.7% in the three months to June, while private sector pay rose by 3.8% year-on-year. Even the Chancellor has acknowledged that Britain “deserves” a pay rise, introducing a higher living wage for low earners in his July Budget.

Recruitment Trends

Recruiters are reporting increased activity:

• Cooper Lomaz currently advertises around 620 vacancies, up from 350 just 18 months ago.
• Over 1,000 candidates found new roles through the agency last year, indicating greater mobility.

Tips for Employees

Paula Lee, partner at Leathes Prior, explains that a pay change constitutes a contractual variation. Her advice:

• Plan your approach: Schedule a meeting—do not ambush your manager.
• Seek feedback: Ask what your employer considers your market value.
• Demonstrate your contribution: Provide evidence you deserve higher pay.
• Time it well: Aim to discuss pay just before the new tax year.
• Set clear targets: If the answer is no, find out what benchmarks you must meet.
• Be decisive: A second refusal may require you to reassess your options.

Tips for Employers

Matthew Newnham, partner at Birketts Solicitors, notes that pay-rise requests can cause anxiety. He recommends:

• Stay calm: Avoid making hasty decisions.
• Discuss performance: Has the employee’s output improved?
• Maintain confidentiality: Prevent a flurry of similar requests.
• Review market data: Ensure your remuneration remains competitive.
• Proactive reviews: Don’t wait—regularly assess and reward staff.
• Consider benefits: Options like health cover, gym memberships, or life insurance can be attractive alternatives.
• Remember: There is no automatic right to a pay rise—it must be earned.

Employer and Employee Perspectives

Mark Fletcher, Operations Director, points out that job-switchers are in demand and often receive multiple offers. “Companies are counter-offering more frequently. There’s more competition and choice for candidates.”

During the recession, employers could be conservative with salaries, knowing fewer roles were available. Many employees had to cover multiple jobs for a single salary, with training and graduate recruitment cut back for several years. Now, certain skill areas face shortages, putting more power back into candidates’ hands and challenging employers to enhance employee engagement and rewards.

Long-Term Impact of the Recession

In 2013, the Office for National Statistics reported that one in seven workers had been made redundant since 2008. Paula Lee recalls the shockwaves businesses felt: “Employers ceased pay rises and slashed headcounts. Those who stayed took on two or three roles out of gratitude—and it showed in rising stress cases and capability issues.”

Now that the UK economy has been growing for over two years, many believe it’s the right moment to ask for a pay rise. As Frances O’Grady, TUC General Secretary, notes, workers deserve a fair share of economic growth after enduring the longest decline in living standards since Victorian times.