Research Briefing | May 21, 2021

UK | Why strong pay growth isn’t what it seems

Ipad Frame (1)-May-24-2021-02-36-01-23-PM

UK wages have recently grown at a pace not seen for over a decade. But rather than a sign of nascent inflationary pressure, changes in the makeup of jobs have exaggerated headline pay, and comparisons with a depressed 2020 will compound this over the next few months.
Lower-paid staff have been more likely to lose their jobs during the pandemic, cutting the weight of these jobs in the average pay calculation. And as people on furlough return to work, y/y earnings growth is likely to hit a record high.

What you will learn about:

  • Pandemic effects will distort headline pay numbers for some time to come
  • The post-Covid world presents upside and downside risks to pay growth.
  • The post-Covid world could see some slight reversal of the power imbalance between employers and their employees

Back to Resource Hub

Related Services

Post

Don’t write the Eurozone consumer off just yet

Eurozone growth in 2025 will rely on consumers. There were positive signs in H2 last year, with consumers starting to deploy their real income gains and the impact of lower rates feeding through. However, we don't think solid H2 outturns signal a sustained increase in momentum. Instead, we expect spending growth to stabilise around the current pace, totalling 1.5% in 2025.

Find Out More

Post

Housing affordability lowest in Greek, Danish, and German cities

House prices across Europe have soared over the past decade, especially in cities. During this time, incomes in Europe have not kept pace with house price hikes on average, squeezing the purchasing power of homebuyers in many European cities.

Find Out More