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UK pay growth cools as Iran war adds cost-of-living pressure

ONS data showed total pay growth, including bonuses, fell to 4.1% in the three months to June from 4.3% in the prior period.

Reported · Written up by our desk · Europe

UK private sector pay growth continued to ease in June, with official data pointing to renewed cost-of-living pressure tied to the wider economic fallout from the Iran war, according to figures from the UK Office for National Statistics.

The ONS said average growth in total earnings, including bonuses, dropped to 4.1% in the three months to June, down from 4.3% in the three months to May. City economists had expected a bigger decline to 4.0%.

The report also showed pay growth excluding bonuses strengthened slightly, rising from 3.4% to 3.5%. The unemployment rate stayed at 4.9% for the three months to the end of June, unchanged from the previous figure.

ONS director of economic statistics Liz McKeown said the data indicated “some softening” in the jobs market, while the overall jobs picture was broadly steady. She also noted private sector pay was easing, while public sector pay growth remained elevated due to the timing of the latest NHS pay awards.

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