Average weekly earning growth in the UK 2001-2024
Wages in the United Kingdom grew by approximately 5.2 percent in October 2024, although when adjusted for inflation, wages only grew in real terms by 2.2 percent. When bonus pay is included in wage growth calculations, wages grew by 5.2 percent in nominal terms, and by 2.2 percent in real terms. Between March and June 2020, there is a clear fall in wage growth, brought on by the sudden economic shock caused by the COVID-19 pandemic, with the high-growth rates in the first half of 2021 also partially skewed by this factor.
Almost two years of inflation outpacing wages
Between November 2021 and June 2023 inflation was higher than wage growth in the UK, resulting in falling real terms earnings throughout this 20-month period. While UK inflation peaked at 11.1 percent in October 2022, it was not until April 2023 that it fell below double figures, and as of December 2023, was still at the relatively high rate of four percent. Forecasts from the Autumn 2023 budget predict that the annual UK inflation will have averaged out at 7.5 percent in 2023, before falling to 3.6 percent in 2024. The decline in real term wages is just one of the aspects of the current Cost of Living Crisis, which has led to the steepest fall in living standards for a generation
Average earnings and gender pay gap
For full-time workers in the United Kingdom, the median average annual earnings was 34,963 British pounds in 2023, compared with 33,061 pounds in 2022. In London, average salaries were significantly higher than the rest of the country, at 44,370 pounds. Just two other areas of the United Kingdom, the South East and Scotland, had annual salaries above the UK average. North East England had the lowest average salary, at 31,200 pounds. As of 2023, the gender pay gap for median gross hourly earnings in the UK was 14.3 percent for all workers, falling to 7.7 percent for full-time workers and -3.3 percent for part-time workers. Compared with 1997, when the gender pay gap was 27.5 percent for all workers, there has been a degree of progress, although, at current trends, it will be some time before the gap is closed entirely.