Inflation continues to erase impact of wage growth

Unemployment falls

James Baxter-Derrington
clock • 1 min read

The impact of continually high inflation has negated the benefits of strong wage growth, as households struggle with rising costs.

While growth in average total pay was recorded at 5.4% and average regular pay at 4% from December 2021 to February 2022, in real terms, the story was different. When adjusted for inflation, the average total pay grew just 0.4%, while average regular pay fell by 1% on the year. Senior personal finance analyst at interactive investor Myron Jobson described a "cycle of bumper wages nullified by rising prices" on the horizon. "While it is the best period in years for wage growth, many households will still feel like they are not making any headway against higher prices for everything ...

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