UK wage growth slowed in the three months to January as economic pressures made employers more uncertain about hiring, official data showed on Tuesday.
Annual growth in average total pay, including bonuses, was 5.7 per cent in the three months to January, down from 6 per cent the previous month, according to the Office for National Statistics. Excluding bonuses, regular pay growth eased from 6.7 per cent to 6.5 per cent. These figures are well below inflation, pointing to a drop in living standards.
Wage growth remains much higher than the Bank of England would like, as the central bank battles to curb high inflation, but the latest data could give policymakers some reassurance that labour market pressures are starting to ease.
The unemployment rate remained near record lows at 3.7 per cent, despite the weaker economic climate, while the employment rate was 0.1 percentage points higher than the previous three-month period at 75.7 per cent. Vacancies fell for an eighth consecutive month.
The UK workforce remains smaller than it was before the pandemic, but the rate of economic inactivity — reflecting people who are neither in a job nor looking for one — fell to 21.3 per cent, 0.2 percentage points lower than in the previous three-month period.
