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Research Briefing | Apr 26, 2024

Nowcast shows wage growth slowing sharply

Our sentiment data, developed with Penta, suggests that UK private sector wage growth slowed sharply in March and early-April. If official data mirrors our sentiment indicator, it should keep the Monetary Policy Committee on track to cut interest rates in the summer.

What you will learn:

  • Our nowcast also shows that labour demand continued to slow gently in the first months of 2024. In contrast to the significant volatility in recent Labour Force Survey data, our sentiment indicator points to a steady loosening in labour market conditions, more in keeping with the picture from recent data on job vacancies.
  • Sentiment around talent and HR has dropped sharply in recent weeks, suggesting firms are finding it easier to recruit. Other labour demand scores are at, or below, historical averages.
  • Sentiment around remuneration has also fallen, suggesting looser labour market conditions are mitigating the boost to pay growth from the large increase in the National Living Wage in April.
Tags: Financial marketsLabor MarketsMonetary policyPrivate SectorUKWages growth
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