LONDON (Parliament Politics Magazine) – When growing costs are taken into account, regular pay is declining at the fastest rate in over a decade, according to the Office for National Statistics.
When adjusted for inflation, pay excluding bonuses fell 2.2 percent between February and April compared to a year earlier, according to the ONS.
Fuel and energy prices are at an all-time high in the United Kingdom, putting a strain on household finances.
However, when inflation is taken into account, pay, including bonuses, is exceeding price increases by 0.4 percent.
A “high level of bonuses” is continuing to “buffer the effects of rising prices on total earnings for some workers,” according to the head of economic statistics at the ONS, Sam Beckett.
However, if bonuses were excluded, actual pay was declining at its quickest rate in over a decade, she noted.
Regular salary has decreased by about 1.6 percent in the private sector and 4.5 percent in the public sector.
The new wage numbers are being compared to the same period in 2021, when Covid limitations were in effect and some workers were furloughed, according to the ONS.
Meanwhile, the ONS reported that the number of job vacancies in the UK increased to a new high of 1.3 million from March to May.
In the months from February to April, the unemployment rate was 3.8 percent, up marginally from the previous month, while the employment rate was 75.6 percent, still lower than before the pandemic.
The numbers illustrate what a wonderful time it was to be looking for work, said Neil Carberry, the chief executive of the Recruitment and Employment Confederation.
The pay was expanding fast as companies wanted to recruit people to work for them, he said, citing the record number of job openings.
Mr Carberry warned, however, that if they didn’t address the reality that there weren’t enough people seeking employment, that may put another damper on the UK’s economic growth.
They needed to strengthen their activation programmes to help Job Centers swiftly place people in jobs, he added. They also needed to dramatically overhaul the skills system to help fill some of the gaps. An immigration system that was flexible enough to meet the severe shortages they were witnessing in some areas was also required, he said.
