Home Finance Workers continue to struggle as inflation hits wage growth
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Workers continue to struggle as inflation hits wage growth

by uma
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  • The number of payrolled employees has grown to a record 29.8m.
  • Growth in regular pay between July -September was 5.7% – one of the strongest growth rates on record.
  • However, when inflation is taken into account pay fell by 2.7% – one of the largest falls on record.
  • Vacancies fell by 46,000 though they remain extremely high. There is evidence some employers are holding back on recruitment due to economic pressures.
  • Economic inactivity continued to increase – up 0.2% to 21.6%.

The ONS has published Labour Market statistics Labour market overview, UK – Office for National Statistics (ons.gov.uk)

Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown:

“On the face of things, the UK labour market is looking good with high employment rates and rising wages but beneath this shiny veneer there are signs of real turmoil. We may well have seen one of the strongest wage growth rates on record, but this has been completely engulfed by raging inflation and in real life terms workers are seeing their wages fall.

Those in search of better pay may want to make use of the high vacancy rate to find a new job but there are also early signs employers may be putting the brakes on recruitment due to economic pressures. This could cause the market to tighten up in the very near future and make that leap to better paid work more difficult.

The other worrying trend is the continued growth in economic inactivity – those who are not in work and not seeking work. A key driver behind this is long-term sickness and this is largely made up of people who are suffering from mental health conditions such as depression and anxiety. It is a silent epidemic that is ruining people’s ability to work and build their financial resilience as well as making it harder for businesses to fill vacant roles.”

 

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