The average UK pay rise right now
Key Points
- Regular earnings grew 3.4% in the year to March to May 2026
- Adjusted for inflation, real regular pay grew just 0.3%
- Public sector pay grew 5.5% against 2.9% in the private sector
- Total pay including bonuses did better, up 1.1% in real terms
British workers received an average pay rise of 3.4% over the past year, but inflation ate almost all of it, leaving real regular pay growth at just 0.3%.
Data from the Office for National Statistics shows that annual growth in regular earnings, which excludes bonuses, stood at 3.4% in March to May 2026, while total earnings including bonuses grew 4.3%.
Once adjusted for inflation using the CPIH measure, real regular pay grew 0.3% and total pay grew 1.1%. Using the CPI measure, the figures come out slightly better at 0.4% and 1.3%.
In practical terms, a worker on the UK median salary of around £37,000 who received the average rise gained roughly £1,260 before tax, but only around £110 of that represents genuine extra spending power once rising prices come out of the calculation.
Public sector pulls ahead
The headline figure hides a wide gap between sectors. Public sector regular pay grew 5.5% over the year, nearly twice the 2.9% recorded in the private sector. The ONS notes that variations in the timing of public sector pay awards this year continue to affect the comparison.
| Measure | Annual growth | Notes |
|---|---|---|
| Regular pay (nominal) | 3.4% | Excludes bonuses |
| Total pay (nominal) | 4.3% | Includes bonuses |
| Regular pay (real, CPIH) | 0.3% | Adjusted for inflation including housing costs |
| Total pay (real, CPIH) | 1.1% | Bonuses drove the stronger real growth |
| Public sector regular pay | 5.5% | Affected by timing of pay awards |
| Private sector regular pay | 2.9% | Weakest of the headline measures |
Why pay growth is stalling
The pay squeeze reflects a cooling jobs market. Payrolled employee numbers fell 85,000 over the year to May, vacancies dropped to 712,000, and the unemployment rate sits at 4.9%. With fewer employers competing for staff, workers hold less bargaining power to demand bigger rises.
Quilter Cheviot Investment Manager Jonathan Raymond said the figures suggest that although hiring conditions are softening, wage pressures have yet to fade. That combination matters for households beyond the payslip, because the Bank of England watches wage growth closely when setting interest rates.
Inflation figures arrive tomorrow, and Raymond noted expectations that price pressures may edge higher. If inflation rises while pay growth holds at 3.4%, real pay growth could turn negative again, meaning the average pay rise would buy less than nothing extra.
Workers negotiating a rise this year face a simple benchmark: anything below roughly 3% represents a real-terms pay cut at current inflation rates, while public sector workers have secured settlements well above that line.
