Wage growth at highest since financial crisis
Data published by the Office for National Statistics (ONS) has revealed that UK wage growth increased to 3.6% in the year to May 2019, the highest rate since the financial crisis in 2008.
According to the ONS, wages have been rising faster than inflation since March 2018 and that increases to the National Minimum Wage and the National Living Wage have helped wage growth to accelerate. However, the data also showed that average pay is still lower than pre-2008 levels. When average regular pay of £503 is adjusted for inflation to £468 per week it is £5 less than its pre-recession total of £473 a week.
Commenting on the data, Alpesh Paleja, Principal Economist at the Confederation of British Industry (CBI), said:
‘Despite signs that employment growth is tailing off, the labour market remains tight, with the unemployment rate at a multi-decade low. It’s encouraging that pay growth has picked up further, putting more money in people’s pockets.’
‘But as recent data shows, productivity remains in the doldrums. Reinvigorating efforts to boost productivity is critical. Firms must focus on innovative ways to share new ideas and invest in people and technologies.’