Cost of living insights - Office for National Statistics

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Real earnings are still falling

Labour market data show average total pay (including bonuses) for employees rose by 6.5% in February to April 2023 compared with the same period the previous year. Regular pay (excluding bonuses) rose by 7.2%, the largest growth rate seen outside of the coronavirus (COVID-19) pandemic.

However, in real terms (adjusted for inflation) growth in total pay fell by 2.0% and regular pay dropped by 1.3% over the same period.

There were 257,000 working days lost because of labour disputes in April 2023, down from 553,000 in March 2023.

The redundancy rate was 3.3 per 1,000 employees in February to April 2023, a slight fall compared with November 2022 to January 2023.

When comparing quarterly changes, we compare with the previous non-overlapping 3-month average time period.

The UK employment rate was estimated at 76.0% in February to April 2023, 0.2 percentage points higher than in November 2022 to January 2023. The number of people in employment rose to a record high, with increases in both employees and self-employed workers.

The unemployment rate for February to April 2023 increased by 0.1 percentage points on the quarter to 3.8%. The increase was largely driven by people unemployed for up to 12 months.

The economic inactivity rate (those not in work and not seeking work) decreased by 0.4 percentage points in February to April 2023, to 21.0%. This was largely driven by a decrease in those who were inactive for “other reasons” or because they were looking after family or the home.

However, those inactive because of long-term sickness remained at a record high.

The number of job vacancies in the UK fell by 79,000 on the quarter in March to May 2023, to 1.051 million. This was the eleventh consecutive quarterly fall in vacancies, with survey respondents continuing to cite economic pressures as a factor holding back recruitment.

The most recent estimate of payrolled employees for May 2023 shows a monthly increase of 23,000 on the revised April 2023 figures, to 30.0 million.

Pay disputes have been the most common cause of strikes between 1999 and 2018, accounting for 75% of all working days lost because of workplace disputes. We have published an article exploring the impact of strikes in the UK between June 2022 and February 2023.