UK wage rises lag behind inflation despite lowest jobless rate since 1975

Workers see real-terms fall in living standards as rise in self-employment pushes unemployment to 4.3%

Wage rises in Britain have failed to keep pace with inflation, according to the latest official figures, despite a buoyant labour market that saw unemployment fall to its lowest level since 1975.

Average earnings increased by 2.1% in the three months to July compared with a 2.6% increase in inflation in July that left workers suffering a 0.4% real-terms fall in the value of their pay packets.

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