Inflation and Pay

Treasury written question – answered on 8th October 2019.

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Photo of Jonathan Lord Jonathan Lord Conservative, Woking

To ask the Chancellor of the Exchequer, what comparative assessment he has made of rates of wage growth and inflation.

Photo of John Glen John Glen Minister of State (Treasury) (City), The Economic Secretary to the Treasury

The fundamentals of the British economy are strong – wages are growing at the fastest rate in over a decade, employment is at a joint record high and the unemployment rate is at its lowest in over 40 years. Inflation has been at or around target since the start of 2019, and as a result wages have now outpaced inflation on a CPI basis for over a year.

On 1 April 2019, we increased the National Living Wage by 4.9% to £8.21 - an above inflation increase which meant that a full-time worker on the National Living Wage would be earning £690 more over the coming year. Supported by the National Living Wage, the lowest earners have seen their wages grow by 8% above inflation between April 2015 and April 2018.

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