Pay growth fails to keep pace with cost of living

Image source, Getty Images

According to new data, UK wage growth did not keep up with the cost of living.

When taking rising prices into account, regular pay fell 1% from a year earlier.

"Basic pay is now falling noticeably in real terms," said Morgan from the Office for National Statistics.

The cost of living is rising at its fastest rate in 30 years.

New data due out on Wednesday is expected to show a further rise in inflation, which reached 6.2% in February.

In the three months to February, the average wage rose by 4% compared with a year earlier, according to the Office for National Statistics.

The public and private sectors have vastly different pay growth. The private sector's average total pay growth was 6.2% while the public sector's was 1.9%.

Tom Southern says he and his family are having to make cuts because of the rising cost of living.

The 30-year-old moved jobs to get a better salary, but it still doesn't go far enough.

Image source, Getty Images

We have a house and two cars. The little cutbacks you have to make start to add up.

The energy bill for the family has gone up from 69 to 28 a month because of the cost of diesel and the cost of gas. Their weekly shop is up from 50-60 to 80-90.

Tom and his partner are getting married this month and have a lot of bills to pay.

He says that he doesn't see himself as unfortunate, but that he feels sorry for people on a low wage.

The unemployment rate fell last month.

Capital Economics said that the fall in unemployment was due to people taking themselves out of the workforce to look after family or long-term sick. The number of people who are inactive rose in the three month period.

Between January and March, the number of job vacancies increased by 492,400 compared to the first three months of 2020.

In the first three months of the year, the highest rate of vacancies was in construction. Job openings in hotels and food services increased by 13.1%.

There was a decline in demand for people in the gas and electricity sectors.

The Chancellor said the latest figures show the continued strength of our jobs market and that the government was helping to cushion the impacts of global price rises.

Pat McFadden, Labour's shadow chief secretary to the Treasury, said the data shows that the Conservatives are leaving real wages squeezed and people worse off.

At a time like this, Sunak could have chosen a windfall tax on huge oil and gas company profits to cut household energy bills by up to $600.

He said that he decided to make Britain the only major economy to land working people with higher taxes in the midst of a cost-of-living crisis.