REAL terms pay has fallen by almost 3% as wages fail to stay pace with rising inflation, according to the latest data.
Statistics from the Office for National Statistics (ONS) reveal the growth in employees’ average total pay including bonuses was 6.2%.
Wages not including bonuses grew by 4.3% in the three months to May.
But in real terms, taking into account inflation, pay fell by 2.8% – a record drop.
Average total pay growth in the private sector was 7.2% in March to May 2022. For the public sector it was 1.5%.
It comes as inflation reached 9.1% earlier this year as fuel, food and other costs rise.
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In good news, the number of job vacancies rose between April and June to 1,294,000.
Employment stood at 75.9% for those aged between 16 à 64 and unemployment for the same age category was 3.8%.
David Freeman, ONS head of labour market and household statistics, said the figures showed a “mixed picture” for the labour market and offered a stark message on people’s pay.
Il a dit: “The number of people in employment remains below pre-pandemic levels and, while the number of people neither working nor looking for a job is now falling, it remains well up on where it was before Covid-19 struck.”
Il ajouta: “Following recent increases in inflation, pay is now clearly falling in real terms both including and excluding bonuses.
“Excluding bonuses, real pay is now dropping faster than at any time since records began in 2001.”
Adrian Lowery, financial analyst at investing and coaching platform Bestinvest, ajoutée: “While such high levels of inflation will be temporary, those price rises will not reverse, so if pay increases do not keep pace, then in the medium term a standard of living hit will be felt.”
“If there is any consolation however, then it is that the labour market looks robust with employment continuing to rise and employers making jobs available.”
Inflation hit a 40-year high of 9.1% en avril, with struggling households told worse was still to come.
The Bank of England has warned the figure could reach 11% cette année.
Inflation is a measure of how the price of goods and services have changed over the past year.
So the higher the figure, the more you’ll pay for your food and fuel.
There are also fears the UK economy could be heading for recession, despite Gross Domestic Product (GDP) going up by 0.5% en mai.
What help can I get?
The latest figures will be bad news for people struggling during the cost of living crisis, especially with predictions the energy price cap is set to rise this winter, pushing up bills to nearly £3,000.
But there is support on offer for those in need.
The government announced a giant cost of living support package in May and some households could be in line for up to £1,200.
The first instalment of the £650 cost of living payment has already started hitting people’s bank accounts.