The total income of British workers, including bonuses, rose by 2.8% yoy to 514 GBP per week in Q4 2018. This is above the consensus forecast for an increase of 2.6% and the biggest increase since the third quarter of 2015. The wages in the UK rose most in construction (3%) and in the public sector (2.1%).
Without bonuses, the UK wages rose by 2.6% to 482 GBP per week. This is the highest increase in the three months to November 2016 and is fully in line with market expectations.
In real terms, however, the wages and bonuses remain unchanged, while excluding bonuses, the incomes are down by 0.2% for the eleventh consecutive month.
The UK unemployment rate shrank to 4.3% in January, compared with 4.4% a month earlier.
The analysts’ expectations were to maintain the country’s current unemployment rate. By comparison, for the three months until the end of December, the unemployment in the country rose for the first time in two years.
At the same time, the number of workers rose by 168,000 in the three months to January. The decreasing oil prices and slower food expenditure growth have contributed to the slowdown in consumer price growth in the UK in February. The wage growth in the UK lagged behind the financial crisis. But with the lowest levels of unemployment since 1975, and with European Union emigrants, which are likely to decline after Brexit, pay is beginning to rise.
The latest report from the British Central Bank showed that businesses felt pressure from higher mandatory pension contributions, increased inflation, the lack of foreign workers, and difficulties in recruiting and retaining staff.