Wages rise more than expected, but unemployment also rises, says Office for National Statistics | Economic news

Wage growth accelerated more than expected in the three months to September, according to official figures also showing a rise in the unemployment rate.

The Office for National Statistics (ONS) said average weekly earnings, excluding bonuses, rose at an annual rate of 5.7% in the three months to September.

That was up from last month’s figure of 5.4%.

Economists polled by Reuters had forecast a 5.5% rise.

Nevertheless, at 5.7%, it remains well below the official inflation rate of 10.1%.

Real wage growth was 3.7% weaker in September when the effects of inflation were included, the ONS said.

The unemployment rate fell from 3.5% to 3.6% as the number of people in employment fell by 52,000.

Darren Morgan, director of economic and labor statistics at the ONS, said of the change: “The proportion of people who are neither working nor looking for work has risen again.

“Since the start of the pandemic, much of this change has been caused by older workers leaving the workforce altogether, but in the last quarter the main contribution has actually come from younger groups.

“In August and September, more than half a million working days were lost due to strikes, the highest two-month total in more than a decade, with the vast majority coming from the transport and construction sectors. communications.

“With real incomes continuing to decline, it’s no surprise that the employers we interviewed tell us that most disputes are about wages.”

The figures were released as the economy grapples with the problems of the highest inflation in 40 years and the fallout from Trussonomics – namely September’s now largely reversed mini-budget.

Official figures from last week showed contracted economy during the third quarter of the year while cost of living crisis reached the request, leaving the country on track for a prolonged but shallow recessionaccording to the Bank of England, which estimates that the unemployment rate could reach 6.5%.

The Bank fears that a shrinking labor market will add to inflationary pressures, forcing it to raise the bank rate even as the economy heads into the expected recession.

The Truss government’s growth plan exacerbated problems as financial markets questioned the UK’s economic credibility, making imports more expensive due to a collapse in the value of the pound.

Other consequences include a rise in the cost of fixed-term mortgages, which adds to the rising bill for households.

Jeremy Hunt, the Chancellor, will deliver his autumn statement to MPs on Thursday with little firepower to help ease the general pain.

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“Taxes will go up for everyone”

He told Sky News on Sunday that everyone was facing higher taxes as the government, now led by Rishi Sunak, aims to adopt a more sustainable approach to public finances.

It is believed the package will be designed to save around £50billion on annual medium-term borrowing.

Mr Hunt said in reaction to the jobs data: “Tackling inflation is my top priority and that guides the tough tax and spending decisions we will make on Thursday.

“Restoring stability and lowering debt is our only option to reduce inflation and limit rising interest rates.”

Shadow Chancellor Rachel Reeves said: “Today’s figures underscore the impact of 12 years of Conservative economic mistakes and weak growth.

“Real wages have fallen again, thousands of people over 50 have left the labor market and record numbers of people are out of work because they are stuck on NHS waiting lists or they do not benefit from appropriate employment support.

“What Britain needs in Thursday’s autumn statement are fairer choices for workers and a proper growth plan.”

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