Average weekly earnings in Great Britain: May 2020

Estimates of growth in earnings for employees before tax and other deductions from pay.

This is the latest release. View previous releases

19 May 2020

The effect of the coronavirus (COVID-19) pandemic on our capacity means we have reviewed the existing labour market releases and will be suspending some publications.

This will protect the delivery and quality of our remaining labour market outputs as well as ensuring we can respond to new demands as a direct result of COVID-19. More details about the impact on labour market outputs can be found in our statement.

This is an accredited national statistic.

Contact:
Email Roger Smith

Release date:
19 May 2020

Next release:
16 June 2020

1. Other pages in this release

Other commentary from the latest labour market data can be found on the following pages:

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2. Main points for January to March 2020

  • Average weekly earnings (AWE) estimates are based on the pay period that includes the last week of each month, which in March 2020 was after the implementation of coronavirus (COVID-19) social distancing and lockdown measures; the majority of employees’ pay will not have been impacted by the measures because most employees are paid four-weekly or monthly and monthly payroll payments will typically have been set in advance of the announcements.

  • Estimated annual growth in average weekly earnings for employees in Great Britain in the three months to March 2020 was 2.4% for total pay (including bonuses) and 2.7% for regular pay (excluding bonuses).

  • Single month growth in average weekly earnings for March 2020 was 1.5% for total pay and 2.4% for regular pay.

  • Pay in the three months to March 2020 continued to grow faster than inflation over the same period, but its rate of growth has slowed since mid-2019.

  • In real terms (after adjusting for inflation), annual growth is estimated to be 0.7% in total pay and 1.0% in regular pay, both down from a recent peak of 2.0% in the three months to June 2019.

  • Public sector annual pay growth has now outstripped private sector annual pay growth for five consecutive three-month periods.

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The estimates in this bulletin come from a survey of businesses. It is not possible to survey every business each month, so these statistics are estimates based on a sample, not precise figures.

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3. Analysis of average weekly earnings

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The earnings estimates are not just a measure of pay rises as they also reflect changes in the number of paid hours worked and changes in the structure of the workforce, for example, more high-paid jobs would have an upward effect on earnings growth rates.

The rate of pay growth trended upwards from spring 2017. In April to June 2019, it reached 4.0% for total pay and 3.9% for regular pay, the highest nominal pay growth rates since 2008. However, since then growth has slowed. In January to March 2020, it stood at 2.4% for total pay and 2.7% for regular pay.

In real terms, annual pay growth has been positive since the three months to February 2018. This means that during that period, pay has been growing faster than inflation. Growth in real terms for both total pay and regular pay reached a recent peak of 2.0% in the three months to June 2019, before decreasing to 0.7% for total pay and 1.0% for regular pay in the three months to March 2020.

For March 2020, average regular pay, before tax and other deductions, for employees in Great Britain was estimated at £510 per week in nominal terms. The figure in real terms (constant 2015 prices) is £471 per week, which is £2 (0.5%) less than the pre-2008 economic downturn peak of £473 per week for March 2008.

The equivalent figures for total pay in real terms are £497 per week in March 2020 and £522 in February 2008, a 5% difference.

Between January to March 2019 and January to March 2020, average pay growth varied by industry sector (Figure 3). The public sector saw the highest estimated growth, at 3.3% for both total pay and regular pay. The manufacturing sector saw the lowest growth, estimated at 1.7% for total pay and 1.5% for regular pay.

Despite having lower than average pay recently, the wholesaling, retailing, hotels and restaurants sector and manufacturing have seen stronger growth in total pay since 2008 than for any other sector. This industry sector analysis over time was explored in more detail in the March 2020 release.

Figure 4 includes estimates of annual growth in regular pay for the single month of March 2020. These March estimates are of interest because they relate to the pay period that includes the last week of the month, which was after the announcement of both the government lockdown measures and the Coronavirus Job Retention Scheme (CJRS, on 23 and 20 March 2020 respectively).

Note that single-month estimates are subject to sampling variability, which in the case of the whole economy is approximately 0.5% (Table 1). However, Figure 4 suggests limited downward impact on employee regular pay in March 2020. At the whole-economy level, the estimated March 2020 single-month growth in average weekly earnings (AWE) for regular pay was 2.4%, a little lower than the 2.7% for the three months between January and March 2020. A similar pattern is seen for all sectors except the public sector.

Some weekly paid employees will have received less pay because of reduced work and/or being furloughed at the end of March 2020. However, most employees’ pay will not yet reflect changed work or remuneration conditions, because most employees are paid four-weekly or monthly and their monthly payroll payments will typically have been set in advance of the announcements.

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4. Average weekly earnings data

Average weekly earnings
Dataset EARN01 | Released 19 May 2020
Headline estimates of earnings growth in Great Britain (seasonally adjusted).

Average weekly earnings by sector
Dataset EARN02 | Released 19 May 2020
Estimates of earnings in Great Britain broken down to show the effects of changes in wages and the effects of changes in the composition of employment (not seasonally adjusted).

Average weekly earnings by industry
Dataset EARN03 | Released 19 May 2020
Estimates of earnings in Great Britain broken down by detailed industrial sector (not seasonally adjusted).

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5. Glossary

Average Weekly Earnings

Average Weekly Earnings (AWE) is the lead monthly measure of average weekly earnings per employee. It is calculated using information based on the Monthly Wages and Salaries Survey (MWSS), which samples around 9,000 employers in Great Britain.

The estimates are not just a measure of pay rises as they do not, for example, adjust for changes in the proportion of the workforce who work full-time or part-time or other compositional changes within the workforce. The estimates do not include earnings of self-employed people.

Estimates are available for both total pay (which includes bonus payments) and regular pay (which excludes bonuses). Estimates are available in both nominal terms (not adjusted for inflation) and real terms (adjusted for inflation).

Bonus

A bonus is a form of reward or recognition granted by an employer. When an employee receives a bonus payment, there is no expectation or assumption that the bonus will be used to cover any specific expense. The value and timing of a bonus payment can be at the discretion of the employer or stipulated in workplace agreements.

Consumer Prices Index including owner occupiers' housing costs

As of 21 March 2017, the Consumer Prices Index including owner occupiers' housing costs (CPIH) became our lead measure of inflation. It is our most comprehensive measure of UK consumer price inflation.

Monthly Wages and Salaries Survey

The Monthly Wages and Salaries Survey (MWSS) is a survey through which we collect information on wages and salaries. It is distributed monthly to around 9,000 employers covering around 12.8 million employees.

A more detailed glossary is available.

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6. Measuring the data

Coronavirus (COVID-19)

The coronavirus (COVID-19) pandemic presents challenges to accurate measurement of the labour market, as outlined in this article. In March, average weekly earnings (AWE) responses from companies were of sufficient volume (a response rate of 77%, close to the 83% target in more typical months) that the challenges were handled within the existing survey design. Further declines in response rates may require methodology revisions in coming months.

In response to the developing situation, we are working to ensure that we continue to publish economic statistics. For more information, please see COVID-19 and the production of statistics.

We have reviewed all publications and data published as part of the labour market release in response to the COVID-19 pandemic. This has led to the postponement of some publications and datasets to ensure that we can continue to publish our main labour market data. This will protect the delivery and quality of our remaining outputs and ensure we can respond to new demands as a direct result of COVID-19.

David Freeman, head of labour market statistics at the Office for National Statistics (ONS), has looked at how the ONS is responding to the pressing need for new information in his blog, Measuring the labour market during the coronavirus.

For more information on how labour market data sources, among others, will be affected by the COVID-19 pandemic, see the statement published on 27 March 2020.

Data in this statistical bulletin and accompanying datasets relate to periods up to and including March 2020 and are largely unaffected by recent developments.

Our latest data and analysis on the impact of COVID-19 on the UK economy and population is now available on our dedicated COVID-19 web page. This is the hub for all special COVID-19-related publications, drawing on all available data.

After EU withdrawal

As the UK leaves the EU, it is important that our statistics continue to be of high quality and are internationally comparable. During the transition period, those UK statistics that align with EU practice and rules will continue to do so in the same way as before 31 January 2020.

After the transition period, we will continue to produce our labour market statistics in line with the UK Statistics Authority's Code of Practice for Statistics and in accordance with International Labour Organization (ILO) definitions and agreed international statistical guidance.

This bulletin relies on data collected from the Monthly Wages and Salaries Survey (MWSS), a survey of employers in Great Britain, excluding small businesses employing fewer than 20 people.

More quality and methodology information on strengths, limitations, appropriate uses, and how the data were created is available in the Average weekly earnings QMI.

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7. Strengths and limitations

The figures in this bulletin come from a survey of businesses that gathers information from a sample rather than from the whole population. The sample is designed to be as accurate as possible given practical limitations such as time and cost constraints. Results from sample surveys are always estimates, not precise figures. This can have an impact on how changes in the estimates should be interpreted, especially for short-term comparisons.

As the number of people available in the sample gets smaller, the variability of the estimates that we can make from that sample size gets larger. Estimates for small groups (for example, earnings for the construction sector), which are based on small subsets of the Monthly Wages and Salaries Survey (MWSS) sample, are less reliable and tend to be more volatile than for larger aggregated groups (for example, earnings for the private sector).

In general, short-term changes in the growth rates reported in this bulletin are not usually greater than the level that can be explained by sampling variability. Short-term movements in reported rates should be considered alongside longer-term patterns in the series and corresponding movements in other sources to give a fuller picture.

Further information is available in A guide to labour market statistics and A guide to sources of data on earnings and income.

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Contact details for this Statistical bulletin

Roger Smith
labour.market@ons.gov.uk
Telephone: +44 (0)1633 456120