The UK has recorded its second largest fall in real wage growth since records began over 20 years ago, in addition to yet another drop in job vacancies, new data has found.
The Office for National Statistics (ONS) reports that, in real terms, (adjusted for inflation) over the year, total and regular pay both fell by 2.7%; this is slightly less than the record fall in real regular pay we saw in April to June 2022 (3.0%) but still remains among the largest falls in growth since records began in 2001.
The UK employment rate for August to October 2022 increased by 0.2 percentage points on the quarter to 75.6% but is still below pre-coronavirus pandemic levels.
In September to November, the estimated number of vacancies fell by 65,000 on the quarter to 1,187,000. Despite five consecutive quarterly falls, the number of vacancies remains at historically high levels. The fall in the number of vacancies reflects uncertainty across industries as economic pressures continue to be a factor in holding back on recruitment.
The ONS also reported 417,000 working days lost due to labour disputes in October, which is the highest since November 2011.
Jonathan Boys, CIPD’s labour market economist, said: “The fifth consecutive quarterly fall in job vacancies shows that employers are tapping the brakes but are a long way off from heading into reverse. It takes months to recruit, so vacancies are a good leading indicator of what’s coming around the corner. A recession may take some of the heat out of labour demand for some sectors, but sectors like health and social care are unlikely to be one of them, as pressure on the NHS continues to build.
“Few people are seeing their pay keep up with rising prices as real earnings are down 2.7%. Although inflation may have ‘peaked’, even as it comes down prices will still be going up. The cost-of-living crisis has some time to run yet. The Bank of England is likely to raise rates again on Thursday which will further thump the finances of householders with mortgages.