Pay growth slips further behind inflation

Pay growth has been lower than the rise in the cost of living for several months

The decline in real terms pay has deepened while the number of people in jobs has also slipped back, official figures show.

Wages grew by a below-inflation 2.2% in the three months to September, according to the Office for National Statistics (ONS).

That meant pay in real terms – when taking into account inflation – dropped by 0.5%, the seventh month in a row of decline.

The gap has widened from 0.4% recorded the previous month as the rise in the cost of living accelerated.

The figures cover a period which saw inflation climb to a five-year high of 3%.

The unemployment rate, at 4.3%, remained at its lowest level since 1975. The jobless total fell by 59,000 to 1.42 million.

However the total number of employed people, at just over 32 million, was down by 14,000 – the biggest fall in two years – partly reflecting an increase in those classed as economically inactive, meaning they are not seeking or available to work.

Matt Hughes, senior ONS statistician, said: "After two years of almost uninterrupted growth, employment has declined slightly on the quarter.

"However it remains higher than it was this time last year, and as always we would caution people against reading too much into one quarter's data."

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