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UK jobs data paint a mixed picture, regular wage growth moderates

Growth in wages ex bonuses eases in line with forecasts but average earnings inc bonuses remain resilient enough to concern the BoE.

14 November 2023

This morning saw the second release of the newly calculated employment data in the UK. Now including payroll and claimant data, it is intended to give a more accurate picture of the underlying labour market. The change in the number of people claiming unemployment benefits dropped to 17.8k from 20.4k the previous month, but this was above forecasts of 15k.

The overall unemployment rate of 4.2% came in much as expected but what will continue to worry the Bank of England (BoE) is the persistence of wage growth (including bonuses) which isn’t falling back as quickly as they would have hoped; the latest three-month moving average is still 7.9%, far higher than the 6.0% growth of this time last year. As long as this stays higher than expected (and expectations were for a fall to 7.4%), consumer inflation won’t be falling as quickly as the BoE want.

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Charles Hepworth

Investment Director
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