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Bloomberg
UK wage growth accelerated to a near 10-year high, backing the Bank of England’s view that there is now no spare capacity in the labour market.
Average earnings excluding bonuses rose 3.2 percent in the three months through September from a year earlier, the most since December 2008, the Office for National Statistics said on Tuesday. Unemployment unexpectedly rose from a 43-year low to 4.1 percent.
The pay figure was higher than the 3.1 percent rate predicted by economists in a Bloomberg survey Upward pre-ssure on wages is a sign of domestically generated inflation. With productivity subdued (out-put per hour rose an annual 0.1 percent in the third quarter), BOE officials say gradual rate hikes will be needed Pay is
continuing to outpace prices, a relief for households squeezed by the inflation surge following the Brexit vote, and a further pickup is forecast.
But real wages are still below their pre-crisis levels and the Resolution Foundation says it will take until 2024 to return to that point Job creation has helped to support consumer spending. The number of people in work rose 23,000 to a record 32.4 million, leaving the employment rate at 75.5 percent.
Unemployment rose 21,000 amid a jump in participation Prime Minister Theresa May will welcome the pay figures as a sign of economic strength as she faces intense pressure over Brexit. Employment is being driven by full-time work.