Economy: Weakest Pay Growth For Five Years
Official figures show pay is growing at its weakest level for five years, heightening renewed concerns over the cost of living.
The Office for National Statistics' (ONS) latest monthly update on jobs and pay showed an improving picture for employment, with the jobless rate falling to 6.5% in May, but highlighted a deteriorating picture on pay growth despite the improving economy.
In the three months to May, total pay including bonuses rose at an annual rate of 0.3% - down from a yearly rise of 0.8% in the three months to April.
The ONS said the figure continued to be affected by comparisons with the same month last year, when many companies delayed paying bonus awards to help their employees benefit from a cut in income tax.
When the effect of bonuses was excluded, growth of 0.7% was measured - which the ONS said was the slowest rate under that measure since records began in 2001.
Just 24 hours previously, the ONS charted a steeper-than-expected increase in the headline measure of inflation - from an annual rate of 1.5% in May to 1.9% in June - confirming that the gulf between rising prices and pay increases was widening further.
The Government admitted there was "more work to do" to help bolster living standards but pointed to the unemployment figures as evidence that progress was being made.
The employment minister Esther McVey told Sky News the recovery had "reached a milestone" in terms of employment, with the total rising by 254,000 in the three months to May past the 30 million mark for the first time.
Much of the increase was attributed to hiring by companies rather than rising self-employment levels, which had been credited for rises over previous months.
The unemployment total was calculated at 2.12m - a fall of 121,000 - with the numbers claiming jobseeker's allowance dropping by 36,300 in June.
Frances O'Grady, general secretary of the union organisation the TUC, said: "It's good to see unemployment falling, but with pay growth falling to a record low, serious questions must be asked about the quality of jobs being created in Britain today.
"If all the recovery can deliver is low-paid, low-productivity jobs - many of which don't offer enough hours to get by - then it will pass most working people by and Britain's long-term economic prospects will be seriously diminished."