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Pay squeeze likely to last until Christmas as inflation bites - CIPD

Commenting on the latest ONS labour market statistics, Ian Brinkley, Acting Chief Economist at the CIPD said:

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CIPD

“The ongoing fall in real wages continues to undermine what is a very positive picture on employment. The combination of lagging pay rises and ever increasing levels of inflation will leave many workers feeling the squeeze again. Given there is little prospect of pay picking up in the near future, people will be forced to tighten their belts well into the Christmas period, putting additional pressure on already tight pay packets. In order to boost pay, the Government need to place a much stronger focus on boosting workplace productivity in their industrial strategy.

“The strong jobs growth is based mainly on an increase in permanent full-time positions for both men and women. There is also further evidence that employers are meeting labour demand by utilising older workers, with 195,000 more 50-64 year olds employed over the last year. Businesses will be required to continue to pursue all avenues in order to fill labour demand, especially if Brexit negotiations result in additional restrictions on migrant labour supply.”