Pay Growth August 2023
Data released by the Office for National Statistics (ONS) this month indicated that pay expansion, not accounting for bonuses, surged by 7.8% between April and June of this year in contrast to the corresponding period the prior year. This marked the most substantial yearly growth rate since the commencement of comparable record-keeping in 2001.
The ONS reported:
In April to June 2023, annual growth in regular pay (excluding bonuses) was 7.8%; this is the highest regular annual growth rate since comparable records began in 2001.
Annual growth in employees’ average total pay (including bonuses) was 8.2% in April to June 2023; this total growth rate is affected by the NHS one-off bonus payments made in June 2023.
In April to June 2023, annual growth in real terms (adjusted for inflation using Consumer Prices Index including owner occupiers’ housing costs (CPIH)) rose on the year by 0.5% for total pay and 0.1% for regular pay.
Annual average regular pay growth for the private sector was 8.2% in April to June 2023; this is the largest annual growth rate seen outside of the coronavirus (COVID-19) pandemic period.
Annual average regular pay growth for the public sector was 6.2% in April to June 2023; a larger annual growth rate was last seen in August to October 2001 (6.3%).
The finance and business services sector saw the largest annual regular growth rate at 9.4%, followed by the manufacturing sector at 8.2%; this is the highest annual regular growth rate for the manufacturing sector since comparable records began in 2001.
The yearly increase in the average overall compensation for employees, encompassing bonuses, reached 8.2% during the period from April to June 2023. This stands as the most substantial annual growth rate observed outside the timeframe affected by the coronavirus pandemic. It's important to note that this annual growth rate for total compensation is impacted by the one-time bonus disbursements within the NHS in June 2023. Further details can be found in the Sector and Industry section.
When accounting for inflation using the Consumer Prices Index, which includes housing costs for owner occupiers (CPIH), the real-term figures for April to June 2023 portray a 0.5% increase in total compensation over the year, with regular pay experiencing a 0.1% rise in the same timeframe.
Source: ONS
