Market comment

Acceleration in pay will make Bank of England’s job harder

DAVY VIEW

This morning’s UK labour market data provide mixed signals on the pace at which jobs growth is slowing. Headline employment at 32.7m is down 0.2% over the past three months, but the timelier payroll employee measure rose by a further 0.2% to a fresh high of 29.8m. However, recent Purchasing Managers Index (PMI) and Recruitment and Employment Confederation (REC) surveys clearly point to a slower pace of job creation. Vacancies fell slightly but the labour market is still very tight. Hence, total pay growth accelerated to 6% in September, unwelcome news for the Bank of England in its efforts to bring Consumer Price Index (CPI) inflation back to the 2% target.

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Nov 15 2022, 08:40 GMT

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