Inflation

Four in five employees received a smaller pay award in 2025 than in the previous year, as employers increasingly show restraint.

ONS announces an unexpected rise in inflation to 3.6% in June 2025, still significantly higher than the Bank of England’s target of 2%.

The number of workers taking second jobs is at its highest level since records began as workers feel the pinch of rising prices.

BoE: Signs the UK jobs market is slowing because employers are adjusting hiring and salary in response to higher employers' NIC.

The median pay award in the UK remained steady at 3% in May, with public sector pay awards outstripping the private sector.

Pay awards in real terms could decrease for a “prolonged period” after inflation overtook salary increases for the first time in 19 months.

UK labour market figures from Office for National Statistics show decline in regular earnings alongside rise in unemployment.

Private sector median pay award for three months to March 2025 stood at 3.5%, according to Income Data Research.

Despite the recent increase in National Insurance contributions, data from Brightmine, indicates that a sharp drop in pay awards is unlikely in the near term.

Chancellor Rachel Reeves has welcomed new figures indicating an unexpected rate of growth for the UK economy in February.

There were no further surprises for employers in today’s Spring Statement as they prepare for next week’s minimum wage and national insurance increases.

UK inflation fell by more than expected in February, down from 3% to 2.8%.

Ahead of an interest rate decision today by the Bank of England, the figures show wage growth including bonuses at 5.8% – broadly unchanged in the three months to January.

The UK jobs market is “in recession territory” and the Chancellor must act decisively ahead of the spring statement, a think tank warns.

Pay rises in the private sector remained at 4% in the three months ending in January 2025, according to new figures.