Pay growth at lowest rate in more than five years

"Annual earnings - excluding bonuses - grew at an annual rate of 3.8% in the November to January period, the Office for National Statistics (ONS) said. The figures also showed that the unemployment rate remained unchanged at 5.2%. The number of vacancies remained "largely stable", the ONS said, with declines in openings at smaller firms being offset by rises among larger ones."

"Despite the slowdown in pay growth from its previous figure of 4.2%, wages are still rising faster than the rate of price increases, with inflation currently standing at 3%. The ONS said regular earnings growth was 5.9% for the public sector and 3.3% for the private sector."

"Demand for labour is weak, which should curtail workers' bargaining power and limit the scope for a pick-up in wage growth. This could see interest rates staying higher for longer, raising the prospect of a more pronounced loosening in the labour market over the coming months."

Annual earnings growth, excluding bonuses, has declined to 3.8% in the November to January period, marking the lowest rate in more than five years. The unemployment rate remained stable at 5.2%, while job vacancies stayed largely unchanged as declines in smaller firms were offset by increases in larger ones. Despite the slowdown from the previous 4.2% rate, wages are still outpacing inflation at 3%. Public sector earnings grew at 5.9% compared to 3.3% in the private sector. The Bank of England's Monetary Policy Committee is expected to maintain interest rates unchanged, with recent geopolitical tensions affecting fuel prices and energy costs. Economists suggest weak labour demand will limit workers' bargaining power and constrain future wage growth despite potential inflation increases.

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