Average weekly earnings in the whole economy grew by 3.5% in the year to February, the same as the revised rate of 3.5% in January and December. Earnings growth has been showing at this higher level over the winter months, having been at a lower rate of around 2.6% for much of 2018. The regular pay measure of earnings growth, which excludes bonuses, was down slightly from a revised rate of 3.5% in January to 3.4% in February.
Falls in bonus pay nudge earnings growth down to 2.4%
The rate of growth of average weekly earnings in the whole economy dropped back again in the latest figures from the ONS, to 2.4% in the year to June 2018, down from 2.5% in the year to May and 2.6% in the year to April. Bonus pay fell across all industrial sectors, especially in finance and business services, and was a major contribution to the drop in total pay growth.
Underlying earnings growth, as measured by the ‘regular pay’ series, which excludes bonuses, was a little higher at 2.7%. While this was also down on the previous month’s headline figure – which is based on a rolling three-month average – the single-month figures for regular pay for June showed a slight rise, from 2.7% to 2.8%, in contrast to the single-month figures for total pay, which fell sharply from 2.5% to 2.1%.
Average weekly earnings by sector at June 2018
|Average weekly earnings - regular pay (£pw)||Average weekly bonuses (£pw)
|Finance and business services||582||75|
|Wholesale, retail, hotels and restaurants||333||21|
In last month’s figures, the fall in bonuses was confined to the finance and business services sector. However, this month bonuses fell back across all sectors, reflecting weakness in the economy in the year to June.
In the finance and business services sector, total average earnings grew by 1.5% in the year to June, marginally up on the figure of 1.4% in the year to May. In this sector the rise in earnings growth excluding bonuses was 2.4%.
In manufacturing, average earnings grew by 2.5% in the year to June, down from 2.9% in the year to May. However, a year ago, in June 2017, the rate of growth in manufacturing was much lower, at 1.3%.
In construction, where pay growth has been higher than other sectors recently, the rate of growth in average earnings was 5.3%, down a little from a revised figure of 5.7% in the year to May. However, in June 2017, the rate of growth in earnings in construction was almost zero, at 0.1%.
In the lowest-paying sector of wholesale, retail, hotels and restaurants, which has seen significant job losses over recent months, earnings growth was 3.2% in the year to June, the same as the revised figure for May. In June 2017, the rate of growth was a percentage point lower at 2.2%.
Looking at the private sector overall, average earnings growth was 2.4% in the year to June on the total pay measure and 2.8% on the regular pay measure. Meanwhile in the public sector, pay growth was 2.2% in the year to June, the same as the revised figure for May (both on the total pay measure, since bonuses are not a significant component of public sector pay).
Despite the public sector employing a much greater proportion of graduates and professional staff than the private sector, average weekly earnings are currently lower in the former than in the latter. Actual average earnings in the public sector dropped back from £518 in May to £517 in June, slightly behind the private sector figure of £518. First-stage increases from the recent three-year pay deal in the NHS were only paid in July and as such have yet to appear in the ONS data.
The latest average weekly earnings figures from the ONS show that pay growth in the private sector was 2.7% in the year to March, up from 2.5% in the year to February. This slightly higher rate of growth meant that the whole economy figure for average earnings rose from 2.3% in February to 2.4% in the year to March. Meanwhile, average weekly earnings in the public sector dropped back slightly from 1.4% in February to 1.2% in March. Continue reading Earnings growth wiped out by higher inflation
Average weekly earnings rose by 2.3% in the year to February, the same as in the year to January. Previously the ONS put the January figure at 2.2%, but this has been revised up to 2.3% in the latest figures. Looking back at the rate of growth in earnings over the past ten months we can see the rate has been fairly steady at around 2.4 to 2.5%. All these figures are for total earnings, across the whole economy, which include bonuses. Continue reading Earnings growth remains steady at 2.3% in February
Growth in average earnings weakened further in the year to the end of January, according to the latest data from the Office for National Statistics. Much of the fall is due to lower bonuses, but ‘regular pay’, that is growth excluding bonuses, was also lower than previously in most areas of the economy.
Average weekly earnings rose by 2.2% in the year to January, down from 2.6% in the year to December and 2.8% in the year to November. These figures are for total earnings, including bonuses, across the whole of the economy. Excluding bonuses, the annual rate of increase in the year to January was 2.3%, down from 2.6% in December. Continue reading Earnings growth drops further to 2.2%
Average weekly earnings growth in the year to August slowed marginally to 2.3%, down from 2.4% in July. The slowing took place entirely in the private sector. Earnings growth in the private sector was 2.3% in August, down from 2.5% in July. By contrast, earnings in the public sector grew by 1.9% in August, up from 1.6% in the year to July.
The slower growth occurred mainly in three parts of the private sector: finance and business services, manufacturing, and construction. In finance and business services, earnings growth fell back from 3% in July to 2.6% in August. In manufacturing, earnings growth slipped from 2.5% in July to 2.3% in August. However, this rate remains higher than in the past two years when earnings growth was between 1.5 and 1.7%.
Visiting Fellow, University of Greenwich
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Earnings growth remains steady, according to the latest figures from the Office for National Statistics. Average weekly earnings across the whole economy grew by 2.4% in June, up slightly on the rate of growth of 2.3% in May.
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The introduction of the National Living Wage (NLW) in April appears to have only had a minor effect on the latest Average Weekly Earnings (AWE) figures. The earnings data released today by the ONS are for the period to the end of April 2016 and the figures were expected to show a boost to earnings in the lowest-paid sector, that covering wholesale, retail, hotels and restaurants. However total pay growth in this large sector for the period from February to April 2016 was comparatively modest at 1.3%, up slightly on the even weaker three-month average of 1.0% for January to March. Continue reading this free article