Decade high 400k working days lost to strike action in October
Over 400,000 working days were lost to strikes in October, the highest since November 2011, official figures from the Office for National Statistics out today reveal.
Britain has been hit with a wave of industrial action by railway, postal and health workers sparked by pay and working conditions disputes.
Working days lost to staff walk outs are on course to swell even higher from October’s historic high.
Staff represented by the RMT union have today begun four days of strike action after they rejected a four per cent pay rise this year and next from the Rail Delivery Group.
Rail workers will also down tools over the festive period, as will Royal Mail staff on Christmas Eve. On some measures, some form of strike action will take place over the Christmas period.
Experts said legacy strike action had little impact on the UK economy, suggesting businesses and households will shake off disruption this time round.
“GDP rose by 1.1 per cent quarter-on- quarter in Q3 1994—the same as in the prior quarter— when strikes by signal operators after the privatisation of the industry led to several days when only one-third of the usual number of trains ran,” Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said.
Workers are withdrawing their labour in a bid to force employers to hand them an inflation matching wage rise to protect their living standards.
Businesses are being squeezed by swelling energy and labour costs, reducing their room to nudge pay higher.
Prices have climbed 11.1 per cent over the last year, the fastest acceleration in 41 years, far outpacing pay growth.
Separate data from the ONS revealed real incomes shrank 2.7 per cent over the three months to October, one of the steepest drops since records began in 2001.
Experts have forecast workers are on course for the sharpest hit to their living standards on record over the next two years due to price rises continuing to pull ahead of wage growth.
The budget watchdog, the Office for Budget Responsibility, said last month real incomes will collapse 7.1 per cent, the biggest fall ever.
Private sector workers trousered a 6.9 per cent pay bump over the last three months, far above the historical trend, but that was still not enough to retain spending power, illustrating how strong this year’s inflation surge has been.
Public sector workers received a 2.7 per cent raise, meaning they are being hit harder by elevated inflation.
Analysts said the strong wage numbers, coupled with yesterday’s better than expected 0.5 per cent GDP rise, could convince the Bank of England to repeat November’s 75 basis point interest rate hike – the steepest in 33 years – on Thursday to prevent elevated inflation embedding in the UK economy.
“This is the second data release in two days that might increase the chances of the MPC repeating November’s 75 basis points interest rate hike on Thursday,” Ruth Gregory, senior UK economist at Capital Economics, said.
Chancellor Jeremy Hunt said “difficult decisions” are required to tame inflation, alluding to his decision to raise taxes and cut spending £55bn at last month’s autumn statement.
A shallower workforce caused by a jump in long-term sickness after the Covid-19 pandemic, likely due to rising NHS backlogs, has forced businesses to hike pay to attract and retain staff.
However, the ONS’s figures indicated the jobs market is loosening. Economic inactivity – people who are not looking for a job – dropped over 70,000 over the last quarter, driven by older people leaving retirement and flowing back into the workforce.
Inactivity was led lower by people leaving retirement
Vacancies have also dropped off their peaks, but are still running above 1m. The ratio of job openings to unemployed people dropped to its lowest level in a year.
Unemployment nudged higher to 3.7 per cent, still around the lowest level in 50 years, but is being held lower by more than 500,000 leaving the workforce altogether.
The ONS does not count economically inactive people in the jobless figure.