Pay

Meeting: 
MQT on 2014-07-23
Session date: 
July 23, 2014
Reference: 
2014/2867
Question By: 
Fiona Twycross
Organisation: 
Labour Group
Asked Of: 
The Mayor

Question

Recent GLA Economics forecasting suggests that wage inflation will be 2.1% in 2016. Do you agree that this would be insufficient should prices - particularly the cost of housing and transport in London - continue to rise at current rates?

Answer

Answer for Pay

Answer for Pay

Answered By: 
The Mayor

GLA Economics does not forecast real wage inflation. Since the downturn there has been significant pressure on real wages. However, in its March 2014 economic and fiscal outlook the Office for Budget Responsibility highlight that as labour productivity slowly recovers it is expected that wage growth will pick up; the OBR forecast that average UK earnings growth in 2016 would stand at 3.6 per cent.