### Summary
Average wages in Britain rose at a rate of 7.8% annually between April and June, outpacing inflation of 6.8% in July. However, the long-term picture shows that workers are still no better off than they were four years ago, indicating the need for sustained pay rises to improve living standards.
### Facts
- 💰 Average wages in Britain rose at a rate of 7.8% annually between April and June.
- 📉 Inflation in July was 6.8%, lower than the previous month's figure of 7.9%.
- ⚠️ The long-term data shows that workers are no better off than they were four years ago.
- 🔒 The Bank of England is concerned about wage rises leading to inflation becoming entrenched in the economy.
- 📉 The UK's productivity levels have fallen behind its peers since the financial crisis.
### Additional Information
- The Bank of England and Chancellor discourage asking for higher wages, fearing a wage-price spiral.
- The current UK real average weekly earnings figure is the same as it was in May 2019 and December 2010, and no better than in March 2006.
- Sustained pay rises are needed for workers to improve their living standards.
The US added 187,000 jobs in August, but the unemployment rate rose to 3.8 percent, indicating a plateau in the labor market as the Federal Reserve considers another interest rate hike.
The August employment report showed an increase in unemployment and a jump in the number of workers unemployed for more than 27 weeks, indicating a normalization of the labor market; however, the report also highlighted the potential for further job gains in September as new labor force entrants search for employment.
British employers have reduced hiring through recruitment agencies at the fastest rate in over three years, reflecting concerns about the economic outlook, according to a survey by the Recruitment and Employment Confederation (REC), which also reported a decline in spending on temporary workers for the first time since July 2020. Starting salaries rose at the slowest pace since March 2021, highlighting the challenge for the Bank of England in managing wage growth and inflation.
Wage growth in the UK has caught up with rising prices, resulting in real pay no longer falling, according to official figures, although the unemployment rate has risen and job vacancies have fallen. The data will also impact the state pension, which is set to increase by 8.5% next April.
British pay growth hits a record high, potentially leading the Bank of England to raise interest rates again, despite a cooling labor market with rising unemployment and falling job vacancies.
The UK economy contracted by 0.5% in July due to strike action, bad weather, and weak economic growth, but the broader picture remains positive with growth in services, production, and construction sectors, according to the Office for National Statistics (ONS).
Wages in Brighton and Hove have outpaced inflation, while the UK as a whole has seen a real-terms pay increase for the first time since March 2022, although low-paid workers in certain sectors continue to experience wage stagnation.
UK inflation is projected to average 7.2% in 2023, the highest rate among advanced economies, according to the Organisation for Economic Co-operation and Development (OECD), which also raised its forecast for UK inflation.
Private sector employment increased by 89,000 jobs in September and annual pay was up 5.9 percent year-over-year, signaling a decline in jobs and wages in the past 12 months, according to the September ADP National Employment Report.
The United States is expected to add 170,000 jobs in September, which would mark the fourth consecutive month with an increase below 200,000, potentially exacerbating the labor shortage and making it difficult for the Fed to control inflation. The unemployment rate is forecast to fall slightly to 3.7%, while wage growth is expected to rise 0.3%. The impact of labor-union strikes, such as the expanded strike by auto workers, could also affect employment growth.
