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UK public sector wages have risen by just 2.7% since October, according to official figures fueling anger among rail and health workers who are preparing to go on strike at the start of Christmas.
This figure falls far short of the headline rate of inflation, which is now 11.1%, with the cost of living challenge hitting public sector workers particularly hard.
According to the latest data from the Office for National Statistics, private sector workers saw a 6.9% increase in pay, but most of the increase was due to bumper pay packages in the financial sector and employees in the accountancy and legal professions.
The headline rate of pay for all workers excluding bonuses rose to 6.1% in the three months to October, from 5.7% in September.
When the salary data was adjusted for inflation, wages for all workers fell by 2.7% as living standards fell at a time of financial stress for millions.
Ministers have said they will fund a pay rise of 3% for public sector workers and an average of 4% for nurses in line with the pay review body’s recommendations.
However, Tuesday’s figures show a growing disparity between the protection against inflation afforded to some in private sector and public sector norms.
Nurses have rejected the offer and plan to go ahead with a series of strikes in favor of a deal that adds 5% to the Retail Price Index (RPI) measure of inflation, taking their claim to 19%.
Nurse leaders have said they are open to negotiating a final settlement, but say health ministers have failed to consider the offer.
Most economists have predicted that Britain will enter a year-long recession after a slowdown in most private sector orders.
Employers in many sectors, including the manufacturing industry, began laying off workers, pushing the unemployment rate up from 3.6% to 3.7%. Vacancies also fell in the three months to October, indicating that employers are becoming more cautious about filling jobs while the economic outlook remains uncertain.
The ONS said: “The decline in vacancies reflects uncertainty across industries, as respondents continue to cite economic pressures as a factor holding back recruitment.”
Chancellor, Jeremy Hunt. Said: “While unemployment in the UK is close to historic lows, high inflation continues to plague economies around the world as we manage the effects of Covid-19 and Putin’s invasion of Ukraine.”
Hunt added: “To get the British economy back on track, we have a plan to help cut inflation by more than half next year – but it requires some tough decisions now. Any action that risks embedding higher prices into our economy will only prolong the pain for everyone and prevent any prospect of long-term economic growth.
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