Despite the lowest unemployment rate in more than four decades, real wages in the UK fell at their fastest rate in the first quarter of the year since 2014.

17 May, 2017 by RT

Despite the lowest unemployment rate in more than four decades, real wages in the UK fell at their fastest rate in the first quarter of the year since 2014.

According to the Office for National Statistics, wages excluding bonuses rose by 2.1 percent year-on-year which was the weakest increase since July 2016 and below analyst expectations.

Salaries were not keeping pace with inflation which was 2.3 percent in February and March, and 2.7 percent in April. Inflation was driven higher by the falling value of the pound since the Brexit vote.

“If the disparity between pay and price growth continues to increase as we predict, household spending is likely to slow further, weakening overall economic activity,” Suren Thiru, head of economics at the British Chambers of Commerce was cited as saying by the Guardian.

Despite the weak wage growth, there are signs of continued strength in the UK labor market.     More