Wage figures show struggles of strikers, and the tide may be turning on jobs

In the year to September-November, after CPI inflation, real pay (including bonuses) fell 3.9% and regular pay (excluding bonuses) fell 3.8% – one of the biggest falls since records began in 2001. If you use the CPIH measure, they both fell 2.6%.

Before inflation, total pay and regular pay were up 6.4% – a rise from 6.1% the previous month. In the public sector, total pay was up 3.3%, compared to 7.2% in the private sector. Outside the pandemic period, this is the highest growth rate ever seen for the private sector.

The unemployment rate was 3.7%, up 0.2 percentage points from the previous quarter, but down 0.3 percentage points from before the pandemic. Total hours worked fell 10 million hours to 1.04 billion – 16.3 million hours below pre-pandemic levels.

The ONS has released employment and wage data for the year to September-November: UK labour market: January 2023 – Office for National Statistics (ons.gov.uk)

Sarah Coles, senior personal finance analyst, Hargreaves Lansdown said: “We’re trudging through the misery of endless strike action this winter – with more planned from nurses, teachers, ambulance staff, civil servants – as well as rail and bus workers. These figures shine a light on why. Wages overall are falling behind inflation, but public sector wages are losing even more ground – up just 3.3% in a year.

“Wages are falling after inflation for all of us. Not even those sectors seeing the biggest wage rises are keeping pace – with finance and business up 7.6%, and construction up 6.3%. This winter has been a misery of making ends meet for all of us, but it has been particularly stark for the public sector.

“Wage rises may be a long way short of inflation, but they’re still high by historic standards.Outside the pandemic period, this is the highest growth rate ever seen for the private sector.

“There’s widespread agreement that in order to stop a vicious circle of rising prices and wages, someone somewhere has to bear the pain, but striking workers are asking whether it really has to be them – especially given enormous staff shortages in areas like health and social work – which is currently hunting for 69,000 employees. This has added significantly to the unbearable pressure of the past few years, and is unlikely to ease while wages remain depressed.

The tide is turning on jobs

“The tide is turning on jobs. While we may not yet be in a recession, businesses have been wrestling with the rising cost of everything from staff and energy to goods and services. They’ve absorbed what they can, but something has to give, and in many cases staff numbers are in the frame. For a second consecutive month we’ve seen unemployment and redundancies rise slightly – and vacancies fall. We’re also seeing the number of hours worked drop, as businesses cut back.

“After having fallen since the start of 2021, the unemployment rate has risen. There was an increase in those who have been unemployed for less than six months, particularly among those aged 16-24, while the number unemployed for between 6 and 12 months also rose. Meanwhile, redundancies grew, and while the level remains low, it’s possible that this is a sign of more pain to come.

“Vacancies fell back by 75,000 in the month, and while there are still 1.161 million vacancies, they’re down 85,000 in a year. They’ve dropped back every month for six months, and this is unlikely to be the last of it. The employers responding to the survey explained that the future is just too uncertain to recruit at the same pace as they did last year. The tide is turning on employment, and workers risk being left high and dry.”

Other figures from the release

  • The employment rate was 75.6%, largely unchanged from the previous month and 1 percentage point below pre-pandemic levels.
  • The economic inactivity rate was 21.5%, down 0.1 percentage points from the previous quarter, but still up 1.3 percentage points since the onset of the pandemic.
  • The redundancy rate rose by 1.1 per thousand employees, to 3.4 per thousand employees.
  • Estimated employees for December are up 28,000 in a month to 29.9 million.