Salaries are rising at a slower rate in the UK but are still outpacing inflationary price hikes, according to official figures released on Tuesday.
ADVERTISEMENTGrowth in UK wages excluding bonuses slowed to 6.5% in the three months to November, compared with the same period a year earlier, said the Office for National Statistics (ONS).
This figure, which follows analysts' expectations, is down from the 7.3% annual growth figure measured in August to October 2023.
Adjusted in line with inflation, annual regular wage growth rose 1.4% in the period from September to November, compared with the same window last year.
"With inflation falling, it's heartening to see real wages growing for the fifth month in a row," said UK Chancellor Jeremy Hunt.
Meanwhile, annual average wage growth including bonuses slowed to 6.5% from September to November.
"That cooling in wage growth will be welcomed by policy makers at the Bank of England who are coming under increasing pressure to loosen the grip on interest rates," said Danni Hewson, head of financial analysis at AJ Bell.
Just before Christmas, the UK economy celebrated some positive news as CPI inflation fell to 3.9% in the year to November, 0.7 percentage points lower than the central bank had predicted.
That said, Hewson warned that the UK is unlikely to see rate cuts until late spring.
"[This will] allow time for the impact of shipping disruption to be weighed up and to help counter any potential reinflation if energy prices surge," she said.
Fresh inflation data for the UK is expected tomorrow.
A stalling job market
While the Bank of England is holding interest rates steady, the high cost of borrowing is impacting the labour market, as businesses are reluctant to hire.
According to the new ONS data, vacancies in the UK have fallen for the 18th consecutive quarter in October to December, dropping by 49,000 to 934,000.
That said, vacancies are still higher than they were before the COVID-19 pandemic, as lockdowns provoked a flurry of early retirements and saw more young workers return to education.
The ONS has also noted that the UK unemployment rate for those over 16 years old was largely unchanged in this latest quarter, coming in at 4.2%.
