Firms 'not expected' to dish out major pay rises to employees
A recent upturn in the economy does not mean companies will be splashing out on pay rises and recruitment next year, a new report has warned.
The Chartered Management Institute (CMI) claims that controlling costs will be the number one priority for some managers in 2014.
As a result, budgets for wages and staff numbers will mostly hold steady, although some cuts are expected, it said.
"After years of pay freezes and redundancies, many workers will be hoping to see the economic upswing improve their pay packets, but this is unlikely to be the case," said Ann Francke, chief executive of the CMI.
She added: "With growth to date largely driven by consumer spending, hopes for a sustainable recovery depend on business investment following suit.
"Today's research suggests this isn't on the cards. Yes, business confidence has had a much-needed boost, but managers remain cautious about finances."
Overall, the survey, which questioned 750 managers across the UK, paints a cautious picture looking forward.
Two thirds of those polled were optimistic about their company's prospects in the coming 12 months, while half revealed plans to invest in business development and sales - with two fifths targeting marketing and training.
On the down side, more than two thirds of managers believe pay will remain the same or even be cut next year.
A similar number also predict a recruitment freeze or job cuts at their firm in the not-so-distant future.
Flat wage growth has added to the strain on household budgets since the recession took hold in the UK. This, combined with high rates of inflation, means many people are struggling to keep up with their bills and everyday living costs.
Copyright Press Association 2013