UK wage growth slowed in the three months to January as economic pressures made employers more confident about hiring, official data showed on Tuesday.
Annual growth in average total pay, including bonuses, was 5.7 percent in the three months to January, down from 6 percent the previous month, according to the National Statistics Office. Excluding bonuses, regular salary growth decreased from 6.7 percent to 6.5 percent. These numbers are lower than inflation, indicating a decline in living standards.
Wage growth remained higher than the Bank of England expected, as the central bank struggled to rein in high inflation, but the latest data could reassure policymakers that labor market pressures are beginning to ease.
The unemployment rate remained close to a record low at 3.7 percent, despite a weaker economic climate, while the employment rate was 0.1 percent higher than the previous three-month period at 75.7 percent. Vacancies fell for eight months in a row.
Britain’s workforce remains smaller than before the pandemic, but the economic inactivity rate – reflecting people not working or looking for work – fell to 21.3 percent, 0.2 percentage points lower than the previous three-month period. .