UK earnings continue to edge higher in nominal terms, the Office for National Statistics said Tuesday, but with inflation still in double digits, real wages are still showing significant annual declines. In nominal terms, earnings rose 6.1% year-on-year, both including and excluding bonus payments.
In real terms, measured against CPI, both measures fell by 3.9% y/y. Although real earnings continue to edge higher, offering concerns over future second round inflationary pressures for the Bank of England ahead of this week's policy decision, the weakness in real earnings and the hit to consumer spending power will also be a concern to policy makers. (MNI BOE WATCH: MPC To Split, Likely Opt For 50bps Hike)
Overall, the latest employment report was mixed, with unemployment rising 0.1% to 3.7%, despite payrolls adding a further 107,000 jobs. New job openings also slowed down 65,000 to 1.187 million -- still 391,000 above the pre-pandemic level. “Though job vacancies are still at a very high level, they continue to fall and are now lower than they were a year ago," ONS head of economic statistics Sam Beckett said.
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