UK annual wage growth slows to 6.5% as vacancies continue falling

investmentweek.co.uk:

The estimated number of vacancies in the last quarter of 2023 continued to fall to 934,000 – a 49,000 reduction – marking Q4 2023 as the 18th consecutive quarter of vacancy falls, and the longest consecutive run of quarterly falls ever recorded.

In its labour market overview, the agency found that annual growth in real terms, adjusted for inflation, was 1.3% over the three-month period.

Demand for UK labour hits lowest level in a decade

Similarly, the estimated number of vacancies in the last quarter of 2023 continued to fall to 934,000 — a 49,000 reduction — marking Q4 2023 as the 18th consecutive quarter of vacancy falls, and the longest consecutive run of quarterly falls ever recorded.

However, the ONS noted the figures were still above pre-pandemic levels.

The UK employment rate increased by 0.1 percentage points to 75.8% over the quarter, whereas the unemployment rate remained unchanged at 4.2%. The economic inactivity rate, instead, decreased by 0.1 percentage points to 20.8%

The agency's labour market overview was based on data from Pay As You Earn and the Claimant Count figures, due to the uncertainty surrounding the Labour Force estimates, it explained.

Chancellor of the Exchequer Jeremy Hunt said: «It has been tough for many families recently, but with inflation now falling and the economy gradually returning to growth, today's continuing rise in real wages will offer further relief.»

He said: «On top of this the cut in National Insurance contributions will get more people back into the jobs market, not just supporting economic growth but saving a typical two earner household around £1,000 this year.»

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Nicholas Hyett,