Recent data from the Office for National Statistics reveals that UK wage growth has slowed to 5.2%, down from 5.5%, as the unemployment rate rose to 4.6%. This shift is the highest since July 2021, reflecting a cooling labour market after the Covid boom. The Bank of England may consider this slowdown in wage growth for future interest rate adjustments, especially as inflation nears 2%. However, the landscape is complex, as some sectors still face worker shortages even amid rising redundancies.
UK wage growth has slowed to 5.2% amid rising unemployment at 4.6%, which highlights a cooling labour market post-pandemic.
Data indicates a dip in wage growth from 5.5% to 5.2%, which may affect monetary policy, especially as inflation approaches the Bank's 2% goal.
The current labour market trends show a mix of ongoing staff shortages in some sectors, contrasted by falling job vacancies and rising redundancies.
UK businesses face a complex economic landscape where declining wage growth must be balanced with rising unemployment, signaling both progress and risks.
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