Living standards for millions of workers plummeted at their fastest rate since 2009 over the winter as rampant inflation deepened the cost of living crisis, official figures released on Tuesday show.
Total average wages including bonuses dropped by 3.2 per cent in real terms in the three months to January, the biggest decline since the February to April 2009 quarter, according to the Office for National Statistics, and among the largest falls seen since detailed records began in 2001. If bonuses are excluded real wages fell by 2.4 per cent.
In cash terms total pay with bonuses rose by 5.7 per cent and regular pay by 6.5 per cent, but this was outstripped by soaring inflation which has been at or above 10 per cent since last summer, peaking at 11.1 per cent in October.
Tuesday’s ONS figures also showed regular pay for private sector workers went up by 7 per cent compared with just 4.8 per cent for public sector employees.
The data comes on the eve of another wave of strikes by London Tube workers, junior doctors and teachers. However, the number of days lost to strikes fell from 822,000 in December to 220,000 in January 2023.
The unemployment rate for was largely unchanged for the quarter at 3.7 per cent while the employment rate was estimated at 75.7 per cent up by 0.1 of a percentage point.
Darren Morgan, director of economic statistics at the Office for National Statistics, said: “Recent trends have continued, with a slight rise in employment, especially among part-timers.
“Detailed figures from our business surveys also show record numbers of jobs in several sectors, including law and accountancy firms, health, and pubs and restaurants.
“In addition, the number of people neither working nor looking for a job fell overall, driven by a drop in young people.
“However, a record number of people were completely outside the labour market due to long-term sickness.
“Although the inflation rate has come down a little, it’s still outstripping earnings growth, meaning real pay continues to fall.”
He added: “The number of working days lost to strikes fell in January from the very high level seen in December. Nevertheless, many days were still lost, with education the most affected sector.”
