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British pay growth after accounting for inflation almost disappeared completely in the three months to February, the clearest evidence yet that households are feeling the strain of rising prices as Brexit negotiations begin.
Workers’ total earnings including bonuses rose by an annual 2.3 percent in the three months to February, unchanged from the previous period, the Office for National Statistics said this morning.
Economists taking part in a poll had expected wage growth of 2.2 percent.
After taking into account inflation, total pay growth rose just 0.2 percent and excluding bonuses it inched up just 0.1 percent in the three months to February. Those were the weakest real-terms increases seen since mid-2014.
Data released yesterday showed consumer price inflation stood at 2.3 percent in the 12 months to March and the BoE expects it to approach 2.7 percent by the end of this year.
Many private economists expect inflation will surpass 3 percent this year.
The unemployment rate in the period between December and February held steady at an almost 12-year low of 4.7 percent, in line with the median forecast.
The unemployment rate is expected to rise this year as companies hold off from hiring as they wait for more clarity on the country’s future ties to the EU.
The number of people in work increased by 39,000, taking the employment rate to 74.6 percent, a joint record high.
After Britain’s economy withstood the initial shock of the Brexit vote last year, economists have reined in their forecasts for how much unemployment is likely to rise.
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GBP/EUR 1.1762
GBP/USD 1.2500
GBP/AED 4.5934
GBP/AUD 1.6654
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GBP/CHF 1.2568
GBP/NZD 1.8015
EUR/USD 1.0614
GBP/ZAR 17.140