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Pay rising as unemployment falls Pay rising as unemployment falls
(10 minutes later)
Average wages in Britain grew by more than expected between May and July as unemployment fell again. Average UK wages experienced stronger than expected growth between May and July as unemployment fell again.
Average earnings grew an annualised 3.5% in the three month period, despite public sector wages growing at their weakest rate since May 1998. The Office for National Statistics (ONS) said average pay was 3.5% higher than at the same time last year.
The unemployment rate fell to 2.6%, the Office for National Statistics says, which is the lowest since April 2005. The rise came despite public sector wages growing at their weakest rate since May 1998.
The claimant count fell 4,200 last month, however, the figure was almost half that forecast by analysts. Meanwhile the number claiming benefits fell by a 4,200 to 852,900 taking the unemployment rate to 2.6% - its lowest level since April 2005.
The fall in people claiming benefits was much smaller than expected.
"Pay growth has picked up a little but overall wage pressures remain subdued," said Philip Shaw from Investec.
"The divergence between public and private sector wage growth shows the squeeze that is being placed on public sector pay," he added.