The ONS have released their latest estimates of employment, unemployment, economic inactivity, and other employment-related statistics for the UK.

Pay growth in the private sector fell to 2.9% in the three months to July, equalling the lowest rate since October 2020. The equivalent figure for the public sector was 6.3% largely driven by the timing of NHS pay settlements.

Under the triple lock, state pensions will grow by the highest of average wage growth, inflation or 2.5%. Whilst the inflation figure will not be confirmed until next month, it is unlikely to exceed the average wage growth released today of 3.9% giving pensioners a boost from next April.

Unemployment remained at 4.9% reflecting the continued pressure on businesses.

Julia Diniz, Economist at the Resolution Foundation, said:

‘The big winners from today’s ONS data are pensioners, who are set for another large rise in the state pension next spring thanks to the triple lock.

‘The biggest losers are workers in the private sector who are already earning less than they were last autumn. With wage growth slumping to its lowest rate in nearly six years, the UK’s private sector pay squeeze will tighten over the coming months as inflation rises.’

Press releases: ONS | Resolution Foundation

The Institute of Directors (IoD) has called on Chancellor John Healey to help restore confidence amongst UK businesses in the upcoming Autumn Budget.

The IoD recently published its Autumn Budget submission in which it urged the Chancellor to restore confidence, encourage private investment and create the conditions for stronger long-term economic growth.

It argued that persistent weaknesses in investment, productivity and business confidence ‘risk undermining future prosperity’.

The submission identified five priority areas where the Budget can help strengthen the UK’s growth prospects. The IoD urges the government to:

• create a competitive and predictable tax environment
• mitigate the investment and employment consequences of the Employment Rights Act
• sequence devolution to support productivity across the UK
• deliver economically productive infrastructure
• accelerate responsible AI adoption across the business population.

Anna Leach, Chief Economist at the IoD, commented: ‘This Budget must restore confidence and provide a clear signal that the UK is committed to being one of the most attractive places in the world to invest, grow a business and create jobs.’

Press release: Institute of Directors

A study carried out by consultancy Oxford Economics has suggested that the UK has missed out on almost £2 trillion in investment in business and infrastructure over the past quarter of a century.

The study, which was commissioned by Getlink, the owner of the Channel Tunnel, found that private investors in Britain pay an ‘unpredictability premium’ as a result of inconsistent public policy and the rising costs associated with doing business in the UK.

It showed that only Greece has had weaker business investment than the UK in relative terms. The UK invested 18.9% of GDP in 2025 against an average of 22.5% across the Organisation for Economic Co-operation and Development (OECD).

According to Oxford Economics, if the UK had invested at the OECD average, an additional £1.9 trillion would have boosted the economy since the turn of the century.

It said that the burden and design of business taxation; the costs of delivering new capacity; and policy unpredictability have acted as barriers.

Innes McFee, Chief Executive of Oxford Economics, said: ‘The UK has been stuck in a low-growth rut since the late-2000s financial crisis, and it has become the country’s defining economic problem.’

Press release: Oxford Economics