Are wages finally going up?

Brits who are fed up of stretching their wages further every month will be pleased to hear average earnings are finally rising.

In September, earnings excluding bonuses rose 1.3% on the previous year, ahead of the 1.2% rate of inflation – the measure of how much goods and services are going up.

This is the first time in five years wages have risen in real terms – i.e. above inflation – and is mildly better news for Britian’s workers, providing real-wage rises can stay above inflation.

Governor of the Bank of England Mark Carney indicated this morning he is predicting a historically low inflation rate of 1% during next year, setting the bar lower for wage growth and making it more likely earnings will stay above inflation in 2015.

Unemployment

Unemployment also fell, according to the Office for National Statistics.

The number of unemployed people in the UK dropped 115,000 between July and September, to 1.96 million.

Employment Minister Esther McVey said: “Record numbers of people in work means more people with the security of a regular wage who are better able to support themselves and their families.”

However, Paul Kenny, general secretary of the GMB union, said the latest figures were not as positive as they appear.

“Many of the new jobs are precarious and badly paid while the real value of take-home pay for the rest of the workforce is 13% below pre-recession levels,” he said.

“Although 898,000 workers have left public sector employment since 2010 the deficit is still £100 billion because this increased economic activity is not generating more income from taxes.”

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