Pay growth in the UK has started to pick up amid signs that the steady fall in unemployment my be boosting the bargaining power of workers.
Figures from the Office for National Statistics showed that earnings growth in the three months to June was 2.1% higher than in the same months of 2016 – up from 2.0% in the three months to May.
The ONS said unemployment in the quarter ending in June was down 57,000 on the previous three months at 1,484,000. The jobless rate fell to a fresh 42-year low of 4.4%. Employment was up by 125,000 at 32.1m in the three months to June.
Despite the acceleration in earnings growth, living standards remained under pressure because pay has failed to keep pace with inflation, which stood at 2.6% in June.
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