MNI DATA: UK Bonuses Sends Headline Wage Growth to 10-Yr High

-UK Aug-Oct Total Earnings +3.3% 3m/year-ago vs +3.1% July-Sept 

-UK Aug-Oct Regular Earnings +3.3% 3m/year-ago vs +3.2.x% July-Sept 

-UK Aug-Oct Real Regular Earnings +1.0% 3m/year-ago vs 0.9x% July-Sept 

-UK Aug-Oct Real Total Earnings +1.1% 3m/year-ago vs 0.8% July-Sept 

-UK Aug-Oct LFS Unemployment Rate 4.1% vs 4.1% July-Sept 

-UK Aug-Oct Employment Up 79,000; Employment rate 75.7%

By Jamie Satchi and Jai Lakhani

     LONDON (MNI) - UK total earnings soared to the highest level since July

2008 in October, rising by 3.3% on a 3m/3m basis, significantly above the MNI

median of 3.0%.

     On a single month basis, year-over-year growth of 3.9% was the biggest

since March 2015, however appeared to be driven by unusually strong bonus pay.

     The Bank of England's Monetary Policy Committee cited an anticipated

acceleration in wage growth when explaining its decision to hike interest rates

in August.

     Bonus pay growth of 4.2% 3m y/y in October was the third strongest outturn

this year and followed four consecutive periods of negative growth.

     All of this strength was concentrated in October - bonus pay was up 18.1%

y/y, the highest outturn since September last year. According to an ONS

official, bonus pay, usually a low-paying month, was particularly strong in the

finance and services sectors.

     Excluding bonuses, regular earnings, after adjusting for inflation,

improved by an annual pace of 3.3% in the latest three-month period, up from

3.2% in the previous period.

     Elsewhere, the unemployment rate was little changed at 4.1% in the three

months to October.

     Employment rose to 32.48 million, after an increase of 79,000 in the three

months to October, above the market consensus forecast of a 25,000 gain. That

took the employment rate to 75.7%.

     Despite this, however, unemployment increased by 20,000 in the latest three

months, to 1.380 million, explained in-part by a drop in the inactivity count by

95,000 to 8.66 million.

     That took the inactivity rate down to 21.0%, its joint-lowest estimate

since records began in 1971.

     Vacancies, a more forward-looking indicator of job demand, rose 10,000 on

the quarter in October, up to 848,000.

     The claimant count rose by 21,900 in November, leaving the associated

unemployment rate at 2.8%, 0.1pp higher from September's 2.7%.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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