Britain's wage growth slows but job losses 'less alarming'

Annual wage growth, excluding bonuses, slowed to its lowest since the second quarter of 2022 in the three months to May at 5.0 per cent

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British pay growth slowed in May and employee numbers dropped further last month, but the cooling in the labour market which had alarmed some policymakers appeared less acute than previous data had suggested, official figures showed on Thursday.

Annual wage growth, excluding bonuses, slowed to its lowest since the second quarter of 2022 in the three months to May at 5.0 per cent. But the figure was still slightly higher than the 4.9 per cent median forecast from economists in a Reuters poll and April's pay growth was revised up to 5.3 per cent from 5.2 per cent.

The number of employees on company payrolls dropped by a provisional 41,000 in June after a 25,000 decline in May.

However, the May decline was far less sharp than the originally reported reading of 109,000, which represented the biggest decline since early in the COVID-19 pandemic and had triggered concern that businesses were retrenching rapidly in the face of higher labour costs and a weak growth outlook.