BlogUK Pay Growth Speeds up as Unemployment Rate Rises

UK Pay Growth Speeds up as Unemployment Rate Rises

The UK unemployment conditions are a headache to the modern economic market. The unemployment rate in the UK ticked up simultaneously with the total pay growth.

Apart from that, the public pay growth rose to a level which is signifying the largest amount since 2005. Focusing on the UK unemployment rate, from December 2022 to February 2023, a growth of 0.1% is seen. The Office for National Statistics (ONS) showed a 3.8% unemployment rate in that particular quarter.

Well, this data is driven by the people who have been unemployed for more than six months.

However, the total pay is also increasing simultaneously with the growing unemployment rate in the UK. The total pay grew from an annual rate of 5.7% to 5.9% within three months to February 2023.

Well, excluding bonuses, the pay growth rose to 6.7%, which is a record growth compared to 2001 (excluding the coronavirus pandemic).

Comparing the public and private sector pay growth is necessary to provide the appropriate data. Considering the public sector pay growth from December to February, a significant 5.3% was seen. Whereas in the private sector, the pay growth strikes at 6.9%.

Notably, the public sector pay growth is the highest pay growth in the public sector since 2005 (excluding the coronavirus pandemic).

The UK inflation rate jumped to 10.4%, which is the main reason why increased pay is falling across. Eaten up by inflation, non-alcoholic drinks and food rose by 18% in February 2023, which is the latest since 1977.

According to the economist at PwC UK, Divya Sridhar, Inflation-adjusted total pay is signifying a 3% down in the three months to February. It is a sharp decline in earnings.

Moreover, the ONS economic statistics director, Darren Morgan, stated that the decreasing number of people not working nor looking for jobs also signifies the increasing number of people with active jobs or actively searching for jobs. In turn, job vacancies are again in danger.

In the meantime, pay to the employees continues to show down as the prices are getting higher compared to the growth of pay. In real terms, the gap in pay between the public and private sectors is getting narrowed.

However, strikes are becoming a more popular practice in the UK right now. So, once again, the education sector is in danger due to these disputes.

The labour market of the nation is at a turning point.

Yes! The pay rate is high this time, but people of the UK also need to cope with rising interest rates, sticky inflation, slowing growth, and increased wages in difficult business conditions for employers.

Employers are constantly trying to showcase their job opportunities in the market with proper job description to hold the nerve of the enthusiasts.

The strikes of teachers, and civil servants, among other reasons, are the prominent ones behind the failure of the UK economy during February 2023. According to the ONS, over 350 strikes were held in just February.

This is not good news for the economic market of the UK. The labour dispute is a concern to almost 348,000 working days lost in February 2023. This was a rise from 210,000 in January 2023.

However, the UK Chancellor Jeremy Hunt considered this a big issue and acknowledged the issue with rising prices and higher unemployment rates. So, their top priority is to try and halve inflation this year.

News Desk
News Deskhttps://www.businessmanchester.co.uk/
The Business Manchester News Desk team is a collective of experienced journalists and editors dedicated to delivering comprehensive business news and insights from the Manchester area and beyond. With a strong background in finance, technology, property, and innovation, our team ensures that our readers stay well-informed about the latest trends and developments in the business world. Through in-depth reports and insightful analysis, the Business Manchester News Desk team is committed to providing high-quality journalism to its audience.
Latest

Food Escapes debuts in Manchester amid surge in experience-led leisure

A brand new immersive food concept, Food Escapes, is launching in Manchester, bringing together interactive puzzles and dining in a format designed to celebrate the...

UK Property Sales Continue to Crumble at Alarming Rate Despite Signs of Market Resilience in 2026

Whilst a range of national indicators point to a property market that is weathering current conditions with some degree of resilience in the early...

BizX Awards 2026: Midlands Businesses Coached by Anu Khanna Claim Top Honours

Businesses based in the UK Midlands and supported by coach Anu Khanna have enjoyed considerable success at the BizX Awards 2026, with two client...

Bolton’s The Wellsprings hits 50% occupancy

A business transformation consultancy, a commercial design agency, and a Polish translations service are amongst the newest users of The Wellsprings, which is now...
Subscribe to our newsletter
Business Manchester will use the information you provide on this form to be in touch with you and to provide updates and marketing.
Don't miss

How Manchester fleet operators are managing rising running costs

Manchester's taxi and private hire sector is under real pressure. Fuel costs, insurance hikes, and emissions compliance have hit simultaneously. The margin between viable...

BizX Awards 2026: Midlands Businesses Coached by Anu Khanna Claim Top Honours

Businesses based in the UK Midlands and supported by coach Anu Khanna have enjoyed considerable success at the BizX Awards 2026, with two client...

The Rise of Social Trading: How Platforms and Influencers Are Changing Investment Decisions

Forex trading went through numerous changes in the past decade. Rather than going through endless spreadsheets, investors shift towards platforms such as TikTok, X...

Everyday work: Keeping tasks organised without extra effort

Have you ever wondered how a huge school, a busy hospital, or a giant shopping centre stays so clean and safe? It isn't just...

More News

Surprising ways you might be putting your phone at risk

We use our smartphones for everything. Checking traffic, catching up with friends, browsing the sales… they’re our instant source of information. But these devices also provide...

5 Essential health and safety tips for UK workplaces

If you want to keep a UK workplace safe and legally compliant right now, you need to focus on five specific pillars which are...

‘New Maximalism’ set to dominate as Hancocks Jewellers releases 2026 trend outlook

Independent jewellery house Hancocks Jewellers has released its annual trend report, highlighting a major move towards “The New Maximalism”. The forecast points to a...