Sunday, December 3, 2023

Pay rises fail to keep up with the cost of living

AVERAGE pay rises are failing to keep up with the rise in the cost of living, the latest official statistics show reports the BBC.

While wages rose in the year to November, they did not rise as fast as prices over the same period.

This meant that average weekly earnings – adjusted for price rises – fell for the first time since July 2020.

“Salaries are growing reasonably strongly, but some people are saying they are not feeling much better due to rising prices,” the ONS told the BBC.

Regular pay, excluding bonuses and adjusted for inflation, fell 1% in November compared to the same month in the previous year.

In November, the inflation rate rose to 5.1% and is expected to reach at least 6% in spring, according to the Bank of England.

The Resolution Foundation think tank said: “Real wages officially began to fall in November, and the current period of shrinking pay packets is likely to get worse before it starts to ease in the second half of 2022.” 

Salaries, however, are still above pre-pandemic levels. Average weekly pay, excluding bonuses, rose to £550 in November compared with £510 in March 2020. 

Over the longer three-month period, between September and November, wages rose at an annual rate of 3.8%, the ONS said. That was slower than the 4.3% recorded in the three-month period between August and October.

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