Every autumn for the past 10 years we have taken a snapshot of actual forecourt pay from our managed payroll service data. We then analyse that data into geographic regions to see just what is being paid to hourly-paid employees in the UK petrol retailing industry. What makes these figures almost unique is that they’re not based on what people claim to pay but on what has been put through their ’live’ payrolls. This is done for almost 2,500 employees across the UK, during one week in September. Remember though that what we’re showing are average rates per employer, so naturally there may be many individual employees within any given site or company who earn more or less than these figures. We restrict the data to hourly-paid employees in order to help prevent distortion by monthly salaries of management or directors.
When we started publishing these figures in 1998 the pay on our UK average forecourt was £3.76 per hour. By last year the rate had reached £5.59 per hour and the trend analysis prediction for 2008 was £5.72 - so how does it look this year?
? The UK average forecourt employer is paying £5.80 per hour - an increase of 3.8% on last year.
? The highest paying region is the south west of England, at £6.12 per hour; last year’s top payer was Greater London.
? The lowest paying region is Northern Ireland, as it was last year. However this region has seen one of the largest percentage increases at 5.1% to £5.50 per hour.
? The largest percentage rise was in the south west of England - up 8.1%
? The smallest change was in Wales (0.7%).
Behind those headlines there are some other interesting numbers:
? The widest range of pay rates was in the south west - ranging from £4.89 per site to £7.17 per site.
? The narrowest range was in Wales - ranging from £5.55 and £5.81 per hour.
? Although not the top payers this year, Greater London (£5.94) and the south east (£5.80) stay in the top three in the pay league after annual increases of 3.7% and 3.4% respectively.
So what can we make of these results? Obviously pay increases have lagged behind inflation. The RPI figures for September weren’t available as we went to press, but looking at August ’07 to August ’08 the RPI increase was 4.8% on top of July’s 5% increase. Historically a situation like this has always led to a surge in wage demands - but as the daily news reminds us, we may not have too many historic precedents for the current economic situation.
Then we have to consider the effects of the National Minimum Wage (NMW). Our annual comparison is between September ’07 and September ’08 when the NMW for employees over the age of 21 was £5.52 an hour. While the NMW for workers between the ages of 18 and 21 was £4.60 an hour. From October 1, these national minimum rates rise to £5.73 and £4.77 an hour respectively - and some employers have been heard making noises that they intend to concentrate their future staff recruitment/replacement on this younger age bracket in order to keep down costs. Quite how that squares with age discrimination legislation had best be left to employment lawyers. Incidentally, all of our regional averages are well above the NMW for the relevant period, and where the lowest reported site rate in any region appears to be below £5.52 per hour, this is due to the sites having predominantly younger employees.
There is another factor behind the scenes that affects the pattern - consolidation. When we started these reports the range of pay rates within each region was much wider. Ten years ago the majority of forecourts within our database were run by singleton operators. Today a typical employer may be running five or six sites. While some employers may still have different pay rates between their sites, the natural trend is that new staff all tend to be given the same terms, conditions and pay rates.
Predicting anything ’economic’ seems to be a mug’s game right now. However, we’ll have a go! According to our data trend analysis, the UK average rate this time next year should be around £5.95 an hour - anyone care to offer odds on it?