UK wages drop in the sharpest fall on record

Over the past six months, Britain’s unemployment figures have arguably been the economy’s saving grace. While the labour market has been extremely tight – with job vacancies reaching their highest level on record – the headline unemployment rate has settled back at record lows, keeping at bay the last factor that often ushers in dreaded ‘stagflation’. This morning’s labour market update still shows the unemployment rate sitting below 4 per cent – with data from June alone at just 3.6 per cent – as well as signs that the labour market is loosening, slightly, with the number of job vacancies appearing to have peaked.

But all of this is secondary to the wage horror story playing out in the data. This morning, the Office for National Statistics reveals that wages have taken a plunge, falling at the sharpest pace ever seen on record.