UK Average Earnings Index Jumps Again: What You Need to Know (Released June 11th, 2024)

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The Office for National Statistics (ONS) released the latest UK Average Earnings Index (AEI) 3m/y data today, June 11th, 2024. This key metric shows the year-on-year growth in average total earnings (including bonuses) for employees in the UK, averaged over the past three months.

Key Findings:

  • Year-on-year growth in total earnings remained steady at 5.7% for the period ending April 2024.
  • This follows the previous figure of 5.7% reported in May 2024.
  • The growth indicates continued pressure on businesses due to rising labor costs.

What does this mean?

A steady AEI suggests ongoing wage growth, which can be positive for employee spending power. However, it can also contribute to inflationary pressures as businesses may raise prices to offset increasing labor costs.

Public vs. Private Sector:

The report also highlights a continued trend of strong earnings growth in the public sector (6.3%) compared to the private sector (5.9%). This trend has been ongoing since April 2022.

Impact on the Pound:

The AEI is a closely watched indicator by the financial markets. A stronger-than-expected reading is generally seen as positive for the British Pound (GBP), while a weaker reading can have a negative impact.

Looking Ahead:

The Bank of England will be monitoring wage growth data closely as they decide on future interest rate adjustments. Balancing inflation and supporting economic growth remains a key challenge.

Further Resources:

  • Stay informed:

The UK labor market remains dynamic. Keep an eye out for future AEI releases to track wage growth trends and their impact on the economy.pen_sparktunesharemore_vert

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