Sainsbury's has said it will raise hourly pay though it is cautious about recruiting new staff this year due to rising costs. The supermarket chain said wages would rise 5% to £12.60 but it will be introduced in two phases "to help manage a particularly tough cost inflation environment".

The retailer's general merchandise sales slipped 0.1% during the quarter, but jumped 3.4% during the festive period

The UK's second-largest grocery chain, trailing only Tesco, reported robust sales over the festive period, with party food and bottles of fizz in high demand

Sainsbury's has announced it will raise hourly pay in response to "particularly tough cost inflation" after retailers warned prices are likely to rise later this year. The supermarket chain said it would increase wages by 5% from £12 an hour to £12.

Sainsbury's has announced a five per cent wage increase for thousands of staff following a successful Christmas trading period. The pay rise has been described as "inflation-busting" and aimed to support workers through a "particularly tough cost inflation environment".