PAY awards have started to increase after five years of low settlements, according to a study.

A survey of 70 deals shows the first ones arranged in 2014 were worth a median of 2.5 per cent, up from two per cent at the end of 2013.

Pay specialists XpertHR said the range of settlements had increased compared with last year, with the middle half of agreements falling between two per cent and 2.8 per cent.

Median deals across the economy in 2013 were worth two per cent, the fifth consecutive year of low pay awards, the report stated.

Unions have been pressing for bigger wage increases to keep up with inflation, currently 2.7 per cent on the RPI measure and two per cent for CPI.

Sheila Attwood, XpertHR pay and benefits editor, said: "Pay awards ended 2013 on a subdued note, but there are encouraging signs from the first of the 2014 pay deals that have been concluded.

"The 2.5 per cent median pay award in January 2014 is the highest level for almost two years, but it is too early to say whether this pick-up in pay awards will strengthen further."

Frances O'Grady, TUC general secretary, said: "Its great that the longest real wage squeeze in over a century could finally end this year.

"But with working people thousands of pounds worse off than they were four years ago, it'll take several years of strong pay growth to make up the damage thats been done to their living standards."