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The increase in wages accelerated at the end of last year, according to official data that economists said they would strengthen the Bank of England’s gradual access to lower interest rates.
Average weekly profits in three months to December, excluding rewards, were 5.9 percent higher than a year earlier, and from 5.6 percent to three months to November, the National Office said on Tuesday.
The figure was in line with the expectations of economists surveyed by Reuters.
Accelerating salary increases was stronger in the private sector, a major measure for BOE, where average income, excluding rewards, increased 6.2 percent. Public sector salaries increased by 4.7 percent in the period.
BOE provides for the increase in private sector salary by 6.3 percent for the three-month period when it reduces interest rates a quarter point to 4.5 percent this month.
Ashley Webb, economist at Capital Economyics, said the data “give little evidence the bank will deviate from its current gradual access to lower interest rates”.
Increasing wage pressure comes after separate figures showed that salary employment fell by 14,000 between November and December and was 3,000 lower in three months to December than in the previous quarter, said Ons, citing HM income and customs data.
Early estimates for January showed that the numbers of paid employees increased 21,000 from December.
Job figures are closely monitored to evaluate the impact of the October budget of Rachel Reeves on the labor market. The Chancellor increased the contributions of employers’ national insurance and raised the minimum wage.
Boe lowered interest rates on February 6, in its third landing since the summer of 2024, and has said it will take a “careful” approach to lowering future rates.
The last view of the labor market comes before the January inflation data on Wednesday. Economists expect figures to indicate annual price increases that accelerate to 2.8 percent in January, from 2.5 percent in December.
