Pay growth tracking above inflation but not time to get carried away

Woman working in a textile factory © Adobe Images

Responding to the new Labour market overview for November 2023released by the Office for National Statistics, Ben Harrison, Director of the Work Foundation at Lancaster University said:

“Today’s limited data release indicates pay growth is tracking above inflation at 7.7% but we shouldn’t get carried away.

“Real pay growth may be at its highest level for two years, but regular wages have only risen by 1.3% on the year. Insecure and low paid workers are still struggling to make ends meet – our recent research with the Chartered Management Institute shows almost half of insecure workers couldn’t pay an unexpected bill of £300 if it was due within the next seven days.

“While the number of vacancies has fallen to 957,000, which remains well above pre-pandemic levels, experimental estimates for economic inactivity suggest it has remained stable at 20.9%. However, without data for long-term sickness – which was at a record 2.6 million when last reported in September 2023 – we are missing a vital part of the jigsaw.

“With so much uncertainty surrounding the true picture of the labour market, it’s critical that the Chancellor confirms that welfare payments will be uprated next year in line with inflation. And he should resist calls to further increase benefit sanctions on some of the most vulnerable people in society – which the Government’s own research suggests does not result in more people moving into work.

“Instead, the focus should be on improving the quality of jobs available and providing more tailored support for jobseekers with different needs.”

Statistics quoted on insecurity are from - Managing Insecurity: The role of good management (13 November 2023).

Back to News