Average earnings excluding bonuses in the United Kingdom grew by 3.4% in March 2026, slowing from 3.6% in February 2026, according to data updated on 19 May 2026. The moderation in wage growth could signal a slight easing of domestic cost pressures at a time when policymakers and markets remain highly sensitive to inflation dynamics.
The cooling in pay growth may be welcomed by the Bank of England as it assesses the balance between supporting the economy and keeping inflation in check. A lower rate of increase in regular pay can help reduce the risk of wage‑price spirals, although it may also reflect more cautious hiring and pay decisions by employers amid an uncertain outlook.
Investors and analysts will be watching upcoming releases closely to determine whether March’s 3.4% reading marks the start of a more sustained downtrend in UK wage growth or merely a temporary pause after February’s 3.6% figure.
