Total pay falls by 04 in real terms

Total pay falls by 04 in real terms

first_imgTotal pay for employees in Great Britain, including bonuses, fell by 0.4% in real terms between May-July 2016 and May-July 2017, according to research by the Office for National Statistics (ONS).Its UK labour market: September 2017 report also found that regular pay, excluding bonus payments, fell by 0.4% in real terms, which have been adjusted for consumer price inflation, between May-July 2016 and May-July 2017.In nominal terms that are not adjusted for consumer price inflation, both total pay and regular pay increased by 2.1% between May-July 2016 and May-July 2017, which is the same growth rate as between April-June 2016 and April-June 2017.Average total pay, including bonuses, was £505 a week in nominal terms before tax and other deductions from pay for employees in Great Britain in July 2017. This compares to £498 a week in July 2016. Average regular pay, excluding bonuses, was £474 a week in July 2017, compared to £465 a week in July 2016.In real terms, average total pay for employees in Great Britain was £487 a week in July 2017, before tax and other deductions from pay. Average regular pay in real terms, excluding bonus payments, was £458 a week in July 2017, before tax and other deductions from pay.Average total pay for employees in Great Britain, in nominal terms, increased by 34.1% between January 2005 and July 2017, rising from £376 a week to £505 a week. Over the same time period, the Consumer Prices Index, including owner occupiers’ housing costs (CPIH), increased by 32.2%.Ian Brinkley, acting chief economist at the Chartered Institute for Personnel and Development (CIPD), said: “The ongoing fall in real wages continues to undermine what is a very positive picture on employment. The combination of lagging pay rises and ever increasing levels of inflation will leave many workers feeling the squeeze again. Given there is little prospect of pay picking up in the near future, people will be forced to tighten their belts well into the Christmas period, putting additional pressure on already tight pay packets. In order to boost pay, the government needs to place a much stronger focus on boosting workplace productivity in their industrial strategy.”Ben Brettell, senior economist at Hargreaves Lansdown, added: “Good news and bad news from the UK labour market today, with figures showing the jobless rate falling to a fresh 42-year low of 4.3% in the three months to July. The employment rate was 75.3%, the highest since comparable records began in 1971.“As we have come to expect with this monthly data, however, there was a cloud to accompany the silver lining in the form of disappointing wage growth numbers. Economists had expected average pay growth including bonuses to tick upwards to 2.3%, but in the event the number was unchanged from a month earlier at 2.1%.”last_img

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