Unemployment is on the rise in the UK, but so are wages
Pay excluding bonuses was up 7.8% between May and July 2023 compared to the same time last year. When bonuses are factored in, the figure jumps to 8.5%.
The rate of unemployment in the UK rose to 4.3% between May and July, having already risen to 4.2% a month prior, according to official statistics.
The Office for National Statistics (ONS), which released the figures on Tuesday, said the increase in unemployment was largely driven by people unemployed for up to 12 months.
The 4.3% unemployment rate is 0.3% higher than before the COVID-19 pandemic.
The drop in employment has been “driven by falls among men and the self-employed,” Darren Morgan, director of economic statistics at the ONS, said in a post on X (formerly Twitter).
Economic inactivity — those who are unemployed and not seeking work — went up by 0.1% to 21.1% as of the end of July. The increase was dominated by students, according to the ONS, while those inactive because of long-term sickness increased to another record high.
On a more positive note, UK wages continue to increase when looking at several metrics, according to the ONS.
Pay excluding bonuses was up 7.8% between May and July 2023 compared to the same time last year. When bonuses are factored in, the figure jumps to 8.5%.
With the UK’s inflation rate currently standing at 6.8%, this means in theory that wage growth is outrunning the rise in prices, though the reality is likely to feel quite different for family budgets bruised by the cost of living crisis.
The UK’s median monthly wages have increased by 6.7% compared to last year, putting the median monthly salary at £2,260 (€2,630). Monthly salaries are now 21.4% higher than they were in February 2020, the statistics show.
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