Wage growth for British workers has slowed down to its worst pace in six months

July 17, 2018 1:32 pmComments Off on Wage growth for British workers has slowed down to its worst pace in six monthsViews: 25

Wage growth for British workersWage growth for British workers has slowed down to its worst pace in six months despite the record employment, making it more difficult for the Central Bank (BoE) to decide whether to raise interest rates for the second time since the start of the global financial crisis.

The average weekly payout grew by 2.5% yoy for the three months to May, losing momentum after rising by 2.6% over the previous three months. This is the weakest growth rate since last November.

Wage growth without bonuses, which is an indicator that sometimes gives a better idea of ​​the underlying trend, shows close value – an increase of 2.7%. Both readings are in line with the average forecast in a survey among economists.

The British economy seems to recover after the slowdown in the first quarter, when the unusually heavy winter hurt the demand.

From the data presented today it is also clear that unemployment has remained at its lowest level since 1975 – 4.1%, while the share of workers has risen to a record 75.7% after in Q1 2018 were created 137,000 jobs.

“Record-breaking employment is a clear signal that the labor market continues to grow at a good pace”, said Matthew Hughes from the National Statistics Bureau.

Either way, after the vote for Brexit in 2016, Britain’s economic growth slowed down due to high inflation and uncertainty for business. In addition, the International Monetary Fund downgraded the UK’s forecast for 2018 economic growth to 1.4%.

Wage growth is one of the indicators the central bank will take into consideration when deciding on interest rates in the country next month.

The Central Bank of England governor Mark Carney said earlier this month that the economy and wages are rising as the central bank expects to raise interest rates. But this move also has its opponents in the UK.

Comments are closed