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Published: 21/11/2024
The Office for National Statistics (ONS) publishes monthly updates on average weekly earnings across the whole economy and by industry and sector in Great Britain. This commentary relates to ONS’s EARN02 and EARN03 datasets, which cover non-seasonally adjusted earnings, excluding bonuses and including arrears.
Annual growth in construction earnings rises in line with whole economy
Construction wages, as measured by ONS’s Average Weekly Earnings dataset, increased by 4.6% in the year to September 2024. This was an increase on the 4.1% rise seen in the 12 months to August 2024 (revised downwards from 4.2%). On the month, earnings were up 1.1%.
Across the whole economy, the average increase in wages in the year to September 2024 was also 4.6%, the same as in August (revised up from 4.5%).
Annual growth in earnings had been lower in construction than the whole economy average each month since April 2023, though they have recently been converging as earnings growth in the wider economy declines.
Source: ONS – Construction (K5AH) and Whole economy (KA5H), non-seasonally adjusted average weekly earnings, excluding bonuses, including arrears
Comparing pay at a sector level (with index K56S), construction workers saw the fourth highest annual increases in average earnings across all sectors. The biggest annual increases were seen in manufacturing, in finance and business services, and in the private sector.
Source: ONS – EARN02: Non-seasonally adjusted Average Weekly Earnings, excluding bonuses, including arrears, at sector level
The ONS data shows that the construction sector has experienced the most extreme fluctuations in earnings movement in recent years, from a 9.5% annual decrease in May 2020 to a 13.5% increase in May 2021.
Source: ONS – EARN02: Non-seasonally adjusted Average Weekly Earnings, excluding bonuses, including arrears, at sector level
Dr David Crosthwaite, Chief Economist at BCIS, said: ‘Despite the latest uptick, the data suggests that average weekly earnings in construction are returning to trend growth levels last seen prior to the pandemic at around the whole economy average.
‘As demand levels currently remain subdued, we expect some stability in wage growth going forward, although much will depend on any inflationary impacts from the recent budget and future demand levels.’
BCIS produces five-year forecasts of the Average Weekly Earnings construction (K5AH) and whole economy (KA5H) time series for subscribers of BCIS OpX.
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