1. Introduction

This article presents two analyses of the average weekly earnings (AWE) figures, which are published in the UK labour market statistical bulletin. These analyses are updated every month. The first section describes real AWE, which is AWE deflated by the Consumer Prices Index including owner occupiers’ housing costs (CPIH). The second section analyses wages and employment contributions underlying single month movements in the nominal AWE.

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2. Real average weekly earnings

The figures show the recent movements in real AWE (whole economy). This is calculated as nominal unadjusted AWE, divided by the Consumer Prices Index including owner occupiers’ housing costs (CPIH). This series is calculated for regular pay (excluding bonuses, excluding arrears) and total pay (including bonuses, excluding arrears) at the whole economy level and then seasonally adjusted. The data in Figures 1 and 2 are levels of real and nominal AWE, shown on a monthly basis, with an index of 2015=100. Figure 3 shows three-month average year-on-year increases in these derived indices. The data are available in the EARN01 dataset, together with estimates of real AWE at 2015 prices.

Comparing the three months to December 2017 with the same period in 2016, real AWE (total pay) fell by 0.3%, 0.1 percentage points more than the three months to November 2017. Nominal AWE (total pay) grew by 2.5% in the three months to December 2017, while the CPIH increased by 2.7% in the year to December 2017. In the same three-month period, real AWE (regular pay) fell by 0.3%, 0.2 percentage points less than the same three months to November 2017. Nominal AWE (regular pay) rose by 2.5% in the three months to December 2017.

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3. Contributions to nominal average weekly earnings – single month

The wages and employment contributions underlying the latest AWE data are available in the EARN02 dataset each month. The “employment contribution”, shown in these figures, changes if the relative proportion of employment in the 24 industrial headings changes, but will not necessarily change if total employment increases. Employment contributions were significantly negative in 2009 and 2010, largely caused by a shift away from employment in financial and insurance activities, which are relatively highly paid industries.

Figures 4 and 5 summarise the recent figures.

Employment contributions were 0.1% for total pay and 0.1% for regular pay in December 2017.

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Contact details for this Article

Roger Smith
earnings@ons.gov.uk
Telephone: +44 (0)1633 456120