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Wage Growth Slumps to 3.8%, Inflation Concerns Rise

3/19/2026

26 2 Full Breakdown

Summary

Story summary

The Office for National Statistics (ONS) reports wage growth at 3.8% in the three months to January, the lowest since late 2020, with unemployment at 5.2%.
Employment among workers aged 34 and under declined notably.
The Bank of England (BoE) is expected to hold the policy rate at 3.75%.
Economists say wage growth slowing may keep inflation pressures persistent, complicating BoE decisions.

History

Historical Context

The COVID-19 pandemic in 2020 caused the UK economy to contract by 2.5%, with unemployment peaking at 5.0%. By early 2023, wage growth fell to 3.8%, the lowest since the pandemic began, particularly affecting younger workers. These trends highlight ongoing economic challenges and inflation pressures, prompting the Bank of England to adjust its policies in response to the evolving economic landscape.

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Story summary

The Office for National Statistics (ONS) reports wage growth at 3.8% in the three months to January, the lowest since late 2020, with unemployment at 5.2%.
Employment among workers aged 34 and under declined notably.
The Bank of England (BoE) is expected to hold the policy rate at 3.75%.
Economists say wage growth slowing may keep inflation pressures persistent, complicating BoE decisions.

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