Workers are counting the cost of the faltering economic recovery after it emerged pay rises have only slightly edged up.

The latest CBI survey shows manufacturing pay awards averaged 2.7 per cent in the second quarter of this year - a modest improvement on the record low achieved for the first three months of 2.4 per cent.

Firms in the industrial sector said their inability to put up prices and low profits made it difficult to offer better wages.

Service sector pay awards averaged 3.6 per cent in the second quarter, edging up from 3.4 per cent in the first quarter but down from 4.1 per cent a year ago.