Earnings growth falls

Whole economy regular earnings growth for the year to October (excluding bonuses) dropped noticeably to 6.3% (down from 7.7%). The most marked slow-down was in construction (down from 5.7% to 3.6%) where the Construction Products Association is predicting recession in 2024.

A similar trend is reflected in our latest 6% median pay increase on lowest basic rates.

The Bank of England’s agents find more contacts reporting "softer employment intentions, consistent with low or zero employment growth". They report that early indications of pay settlements for 2024 suggest that average wage growth will be lower than in 2023 owing to lower expected inflation, a looser labour market and concerns around the affordability of pay offers.