British pay growth after accounting for inflation almost disappeared completely in the three months to February, the clearest evidence yet that households are feeling the strain of rising prices as Brexit negotiations begin. Laura Frykberg reports.
A bright spot for the UK economy.. Unemployment remaining at just 4.7 percent between December and February - an almost 12-year low. Relaxing fears that Brexit could cause job losses. At least, for UK citizens. (SOUNDBITE) (English) WILSON KING INVESTMENT MANAGEMENT, HEAD OF RESEARCH, RICHARD HUNTER, SAYING: "If there are going to be any kind of restrictions to immigration, it may well be that companies will need to look even more towards the UK for employees as opposed to have the entire European Union. So if anything that could be positive for unemployment." For those in work, their pay is rising no faster than before. In the three months to February - total earnings including bonuses up by an annual 2.3 percent. Unchanged from the previous period. Employers perhaps weighing up how much workers should earn in an independent UK. (SOUNDBITE) (English) WILSON KING INVESTMENT MANAGEMENT, HEAD OF RESEARCH, RICHARD HUNTER, SAYING: "The question of course, is whether if companies needed to be looking no further than the UK for employees, whether they need to be paying them more." Currently though, average pay gains are exactly cancelled out by inflation. Prices also rising at 2.3 percent in the twelve months to March - unchanged from February. (SOUNDBITE) (English) GLOBAL FINANCIAL ECONOMIST, COMMERZBANK, PETER DIXON, SAYING: "I think it will be a temporary pause over the course of the next three to six months we'll see inflation rising from somewhere around two and a quarter per cent to somewhere closer to three per cent, and that's much more of a concern." Energy prices are already up, exacerbated by the weak pound. And if Britons close their wallets, the economy which relies on them, will suffer too.