Has my salary actually decreased?

dylantombides

My employer said my pay for the next year will be a 1.55% increase. This didn't seem much when you factor in inflation. Have I actually had any sort of pay rise or has my pay stayed the same or even lowered when you factor inflation % in?

18cc

I believe the UK inflation rates is around 1.7% at the moment

you have got a pay rise of 1.55% but I assume that is the gross figure you will be paying tax on that at say 20% and also National Insurance

so in answer to your question your salary hasn't decreased it's gone up by 1.55% but it's spending power has almost certainly gone down

Willing2Learn

dylantombides wrote: »

My employer said my pay for the next year will be a 1.55% increase. This didn't seem much when you factor in inflation. Have I actually had any sort of pay rise or has my pay stayed the same or even lowered when you factor inflation % in?

Your salary will have risen at a slower rate than the Consumer Prices Index (CPI) inflation rise for August 2019 (1.7%).
https://www.ons.gov.uk/economy/inflationandpriceindices/bulletins/consumerpriceinflation/august2019

If the CPI rate of inflation were to continue at 1.7%, then your purchasing power and standard of living will lower.

Terry_Towelling

It all depends what you spend your money on. If you spend it on things that generally go up in price, then your spending power may decrease a little. If you spend it on stuff that doesn't go up (or may even come down) in price then you are quids (pence) in.

phillw

dylantombides wrote: »

Have I actually had any sort of pay rise or has my pay stayed the same or even lowered when you factor inflation % in?

Yes, you've had a sort of pay rise. Even if it's not a pay rise in real terms.

Nobody actually deserves a pay rise, just because CPI/RPI goes up that doesn't mean the value of your work goes up. What you need to consider is whether you could earn more money somewhere else doing the same job.

If you could then tell your boss that, but be prepared for them to tell you to accept the higher paid job. Make sure you consider any other perks your current job has (financial and non-financial).