ONS: Real value of pay continues to fall

Report by Office for National Statistics: Cost of living insights – Office for National Statistics (ons.gov.uk)

Regular pay for UK employees fell in the three months to January 2023 after accounting for the rising cost of living.

Labour market data show average regular pay (excluding bonuses) among employees grew 6.5% in November 2022 to January 2023. The private sector saw growth of 7.0%, while it rose by 4.8% in the public sector.

After adjusting for inflation (the rising cost of goods and services), however, regular pay fell in real terms over the year by 2.4%.

The number of vacancies across the UK in December 2022 to February 2023 fell by 51,000, to 1,124,000.

That was the eighth consecutive quarterly fall since the three months to July 2022, with respondents to our survey continuing to cite economic pressures as a factor in holding back on recruitment.

The redundancy rate was 3.3 per 1,000 employees in November 2022 to January 2023. When comparing quarterly changes, we compare with the previous non-overlapping 3-month average time period (for example, comparing November to January with August to October, not with October to December).

Separate data collected between 22 February and 5 March 2023 show around one in six adults in Great Britain (17%) say they are working more hours than usual because of the rising cost of living.

One in five (20%) said they were looking for a job that pays more money, including a promotion. Meanwhile, 3% of adults said they are working more than one job because of rising prices.

Figure 1:ONS figures

Figure 2:ONS figures

Figure 3:ONS figures

More detail:

There were 220,000 working days lost because of labour disputes in January 2023, down from 822,000 in December 2022.

Pay disputes have been the most common cause of strikes between 1999 and 2018, accounting for 75% of all working days lost because of workplace disputes. We have published an article exploring the impact of strikes in the UK between June 2022 and February 2023.

The economic inactivity rate decreased by 0.2 percentage points in the three months to January 2023, to 21.3%. Looking at economic inactivity by reason, the latest quarterly decrease was driven by those inactive because they are students or retired.

The employment rate was estimated at 75.7% in November 2022 to January 2023, which was 0.1 percentage points higher than the previous three-month period. This was driven by increases in part-time employees and self-employed workers.

The unemployment rate was largely unchanged on the previous quarter, remaining at 3.7%