AVERAGE earnings in the UK has remained high, fresh data has shown.
Regular earnings decreased to 5.6% in the three months to February, but was 2.8% higher after taking inflation into account.
That is according to the latest figures from the Office of National Statistics.
Wages, excluding bonus reached 5.9% between December 2024 and February 2025.
In real terms, taking into account inflation, annual regular pay grew by 2.1%
The Bank of England watches jobs and wages figures closely when making a decision about interest rates.
Last month, rate-setters voted to maintain the base rate at 4.5%.
Lenders use the base rate to determine the interest rates offered to customers on savings and borrowing costs, including mortgages.
Today’s figures come a few days ahead of March’s inflation figures which will be released by the ONS on Wednesday.
Inflation fell in February after it was helped by a drop in woman’s clothing to 2.8%.
But it still remained above the Bank of England’s target of 2%.
Inflation is a measure of how much the prices of everyday goods such as food and clothes, and services such as train tickets and haircuts, have increased compared to a year earlier.
[bc_video account_id=”5067014667001″ application_id=”” aspect_ratio=”16:9″ autoplay=”” caption=”Understanding GDP and Its Impact on the Economy” embed=”in-page” experience_id=”” height=”100%” language_detection=”” max_height=”360px” max_width=”640px” min_width=”0px” mute=”” padding_top=”56%” picture_in_picture=”” player_id=”default” playlist_id=”” playsinline=”” sizing=”responsive” video_id=”6355832489112″ video_ids=”” width=”640px”]Elsewhere, the rate of UK unemployment also remained unchanged at 4.4% in the three months to February.
Liz McKeown, director of economic statistics at the ONS said: “Regular pay growth remains strong having increased slightly in the latest period.
[authenticated-scripts src=”%3Cscript%20class%3D%22palin-poll%22%20src%3D%22https%3A%2F%2Fwww.thesun.co.uk%2Fpollingwidgets%2Fv3%2Fwidget.js%3Fquestion_id%3D112455%26game%3Dpolling%22%3E%3C%2Fscript%3E” type=”embedded” width=”100″ /]“Growth accelerated in the public sector as previous pay rises fully fed through to our headline figures, while pay in the private sector was little changed.
She added: The latest survey results estimate that the unemployment rate is unchanged on the previous three months, while separately the number of employees on payroll fell slightly over the same period.”
WHAT IT MEANS FOR YOUR MONEY
Generally speaking, high wages are a positive for the economy, especially when it is higher than the rate of inflation.
It means households have more purchasing power and a lot of that money will go back into the economy.
But rising wages have previously been blamed for keeping inflation high by Bank of England bosses.
Isaac Stell, investment manager at Wealth Club, said today’s figures were “good news” for the government despite the “negative economic mood”.
However said that while today’s figures may be positive, households “must not breed complacency”.
“The hike in taxes will ultimately impact the bottom line for many businesses and the implications on wage growth and employment could be far reaching.”
He explained: “They are yet to account for the higher employment taxes that came into effect this April.”
The government increased the rate of employer National Insurance Contributions from 13.8% to 15% on April 6.
The move was widely criticised by a number of business leaders, who warned the move would lead them to hike prices.
The UK has also found itself in the period of uncertainty as it waits to see the full impact of Donald Trump’s tariffs on economies across the globe.
On the employment front, Suren Thiru, ICAEW economics director, said today’s figures indicate that labour market activity was “sluggish”.
He said: “This strong wage growth may be more a lagging indicator of wider labour market conditions than strengthening underlying inflation, as it takes time for employers to adjust pay settlements to changing circumstances.
“The UK’s jobs market is entering a turbulent period with a troubling mix of escalating global uncertainty and rising cost pressures, notably the national insurance hike, likely to moderately push up unemployment, despite continued challenges over skills shortages. “