Biggest drop in real pay since 2013 as ‘cost-ofliving crisis’ deepens

UK workers suffered the biggest fall in their real pay for nearly nine years as the costof-living squeeze tightened, according to official figures.

The Office for National Statistics (ONS) said regular pay excluding bonuses tumbled 1.8 per cent in the three months to February when taking soaring inflation into account, as measured by the Consumer Prices Index (CPI) - the steepest fall since August to October 2013.

The ONS said real pay was now "falling noticeably", with figures for February alone showing regular wages dropped 2.1 per cent after inflation, which was the biggest drop since August 2013, the ONS added.

When compared with CPIH, which includes owner occupiers' housing costs and is the

ONS'S preferred measure of inflation, real regular wages fell 1 per cent in the three months to February.

While pay rose 4 per cent in the quarter, it was far outstripped by inflation and experts have warned wages will lag even further behind rising prices this year as inflation is expected to rocket in the autumn.

Chancellor Rishi Sunak said the Government was "helping tocushiontheimpactsofglobal price rises through more then £22 billion of support for the costoflivingthisfinancialyear".

But Labour hit out at the Government's move to press ahead with this month's tax rises.

Patmcfadden,labour'sshadow chief secretary to the Treasury,saidmrsunakhas"decided to make Britain the only major economy to land working people with higher taxes in the midst of a cost-of-living crisis."

The latest ONS data revealed theunemploymentratefellfurther below levels seen before the pandemic struck, at 3.8 per centinthethreemonthstofebruary-thelowestsincedecember 2019 and down from 3.9 per cent in the previous threemonths.

Ithasnotbeenlowerthanthis since 1974.

There were 86,000 fewer jobless Britons at 1.3 million in the quarter to February, while those in employment rose 10,000 to 32.5 million.

More timely pay as you earn (PAYE) data showed there was another rise in the number of UK workers on payrolls last month, up by 35,000 between February and March to 29.6 million.

But there were signs of easing demand for staff, with this marking the smallest monthly increase since February last year.