The average pay award was 2.2% with inflation at 1.5% to June 2013, leading to a real improvement in earnings of .70%pa.
The average increase in the Finance Industry was 2.6%, a sign of returning confidence. Given the move to ITIS tax collection this should also have a positive impact on States tax receipts.
Clearly salaries need to be competitive to attract and retain quality people and to encourage young people to come into the finance industry but significantly above inflation pay awards can impact competitiveness which can lose business and cost jobs.
There has been a tempering of pay awards in the last few years and this trend together with a weakening in sterling has made the Island more competitive as a finance centre.
These trends are helping to bring new business into the Island and this is likely in time to provide support to the employment market which is good news.