There are several ways of trying to establish average pay rates in an industry or area. You can ask employers what they pay their staff; you can ask employees what they receive. Or you can do what we’ve been doing every year since 1998 examine the payroll data that PAYEPeople processes on behalf of hundreds of forecourt operators across the UK, and work out the real hourly pay rates that are being paid to thousands of individual employees. Bear in mind that with the advent of ’real time’ reporting to HMRC, these figures are based on the same information that HMRC is seeing.
For the sake of consistency, we perform the calculations using source data from the same month each year September and capture a ’freeze-frame’ of what each hourly-paid employee received as their hourly rate during that month. The data is then split by geographic region and we work out the national and regional average pay rates, and compare them to earlier results. These figures are taken from forecourts across the independent sector and do NOT include any of the supermarket operated forecourts.
A year ago:
UK national average forecourt pay rate September 2012 was £6.29 per hour;
RPI (September 2012) = 244.2;
Adult minimum wage rate was £6.08/hr (18-20 rate was £4.98/hr).
September this year:
UK national average forecourt pay rate September 2013 = £6.40 per hour;
RPI (September 2012) = 251.9;
Adult minimum wage rate was £6.19/hr (18-20 rate was £4.98/hr).
over 12 months, the changes amounted to:
Average forecourt pay increased by 1.8%.
Price inflation increase of 3.2%.
Statutory minimum wage rate (over-21s only) increased by 1.8%.
As usual, there were some surprises in the detail. Last year several regions had shown small decreases in average pay rates; while those didn’t result in an overall fall in rates at that time, there was a chance that a repeat might actually have brought down the national rate this year. Well, it didn’t happen quite that way, with only a single region recording a lower average rate than a year ago, but clearly the overall increase is basically consistent with the small rise in statutory minimum wage over the same period.
There were some surprises in the Regional results:
Northern Ireland £7.09/hr up from £6.27 (+13.1%) was the top-paying region this year, for the first time ever. It might be a one-off result but the region has been rising in the forecourt pay league over the past couple of years it was in sixth place last year.
Midlands £6.47/hr up from £6.37 (+1.6%) last year. In second place on its own this year, with a small increase, but the region had the top-paying site rate of £7.78/hr.
North West England £6.41/hr up from £6.27 (+2.3%). Up to third place and, like the Midlands, this region saw a small reversal of the pay drop recorded in 2012. Now fractionally above the national average pay rate.
South East England £6.38/hr up from £6.37 (+0.2%), this region was third in last year’s table and drops one place to fourth.
Wales £6.37/hr up from £6.15 (+3.5%). Quite a large percentage increase in average hourly rates has taken Wales up to fifth place in the UK. This has been a long-term trend for many years the region was at or near the bottom of the league. It perhaps reflects the urban renewal in places like Cardiff and Swansea.
Greater London £6.36/hr up from £6.28 (+1.3%). Down one place from fifth last year to equal sixth this time. Historically usually near the top of the table, in recent years it has tended to be roughly in the middle of the pay league.
South West England £6.36/hr down from £6.48 (-1.9%). The only region to record a fall within the past 12 months, the South West has tended to yo-yo up and down the table in recent years. Last year’s top-paying area has dropped quite a long way to joint sixth this time.
Eastern England £6.35/hr up from £6.29 (+1%). The region dropped from fourth place to eighth this year, and is now below the national average rate.
Scotland £6.32/hr up from £6.14 (+2.9%). Bottom of the league last year, a relatively large percentage increase has lifted it one place this time. Another region below the national average pay rate.
North of England £6.29/hr up from £6.22 (+1.1%). Down from eighth last year to bottom place this time. As last time, the area shows the narrowest spread of pay rates in the database.
As they have done for some years, forecourt pay increases are still lagging behind retail price inflation and, in common with much of the UK economy, pay rates are considerably below the long-term trends that were established during the ’boom years’ of the ’90s and early ’00s. Hence prediction of future rates has become more of a guessing game than ever, since long-term trend analysis gives much higher predictions than recent results. Realistically it’s difficult to expect the next 12 months to show more than another small increase roughly in line with that of the recent minimum wage rate.
Reminder National Minimum Wage Rate (NMWR) from October 1, 2013
The NMWR increased slightly on October 1, 2013 (ie just a few weeks after these figures were compiled) to:
£6.31 per hour for employees 21 years of age and over (up from £6.19);
£5.03 per hour for employees between 18 and 21 years of age (up from £4.98);
£3.72 per hour for employees 16 and 17 years of age (up from £3.68).
Finally, special thanks to Craig Anderson and Amy Houghton at PAYEPeople for extracting the data that we use for these reports.