UK economy: gloomy outlook for workers' pay rises

HR industry group forecasts average pay to increase just 1.7% with retail sector warning shoppers are dwindling and EU referendum denting confidence

Workers are being warned to expect meagre wage rises until at least 2020, as weak productivity and new costs such as the national living wage curb employers' readiness to raise salaries.

Even though employment is expected to rise, pay growth is forecast to be just 1.7% over the next year, as an ample supply of labour helps employers hold back on wage rises in a "jobs-rich, pay-poor" economy, said the Chartered Institute for Personnel and Development (CIPD).