Finance
UK workers see record pay rises, but inflation eats them up
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LONDON (Reuters) – British workers have had their biggest rise in weekly pay in at least a quarter of a century with the pace of earnings growth for women outstripping that of men, according to a comprehensive labour market survey published on Wednesday.
LONDON (Reuters) – British workers have had their biggest rise in weekly pay in at least a quarter of a century with the pace of earnings growth for women outstripping that of men, according to a comprehensive labour market survey published on Wednesday.
Weekly earnings for full-time employees rose by 6.2% in the 12 months to April – the period covered by the latest Annual Survey for Hours and Earnings (ASHE) which is produced by Britain’s official statistics agency.
This was the fastest growth since comparable records began in 1997.
Despite the increases, workers were out of pocket because of the even bigger jump in inflation over the 12 months to April.
Median weekly earnings for full-time employees fell by 1.5% on the year when adjusted for the Consumer Prices Index including owner occupiers’ housing costs, the ONS said.
The increase in weekly earnings was sharpest for full-time employees in the private sector whose earnings jumped by a record 7.7%, while their peers in the public sector had a 3.7% rise, slowing from 4.9% a year earlier.
Average weekly pay for all men rose by 6.8%, lagging behind a 9.1% increase for women, although the difference in pay growth was smaller when only full-time employees were considered.
Median weekly full-time earnings for women were 13% lower than for men.
The Office for National Statistics said the biggest increases in pay by sector were recorded in lower-paying professions with earnings in caring, leisure and other service occupations up 9.4%.
Median gross annual earnings for all full-time employees rose 5.8% to 34,963 pounds ($42,452), a slightly smaller increase than 5.9% in the 12 months to April 2022.
The Bank of England is worried that the face pace of pay growth in Britain could create a wage-price spiral. It is expected to keep interest rates on hold for the second meeting in a row on Thursday and signal its intent to keep them high.
Britain’s monthly official jobs and pay figures have been beset by problems recently due to low response rates from individuals to its surveys. The separate ASHE survey is based on responses from employers.
($1 = 0.8236 pounds)
(Writing by William Schomberg; editing by David Milliken)
Inflation is the rate at which the general level of prices for goods and services rises, eroding purchasing power.
The Consumer Prices Index (CPI) measures the average change over time in the prices paid by consumers for a basket of goods and services.
Median earnings refer to the middle value of earnings when all employees' earnings are arranged in order, providing a measure of typical income.
A wage-price spiral occurs when rising wages lead to increased production costs, which in turn lead to higher prices for goods and services.
The Office for National Statistics (ONS) is the UK's largest independent producer of official statistics, providing essential data on the economy and society.
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