Latest data shows inflation is tricky to control amid bumper pay rises

Business figures have been sounding increasingly alarmed about the state of the UK's jobs market in recent days, with the recruiter James Reed claiming it augurs a recession.

- Heather Stewart

There were certainly some signs of a slowdown in the latest labour market data, published yesterday - but with pay growing briskly, it was hard to detect a significant shift.

Average regular pay increased at a healthy 5.2% clip in the three months to October, according to the Office for National Statistics (ONS) - up from 4.4% in the previous three-month period. Including bonuses, the figure was also 5.2%.

That means real wages - adjusted for CPI inflation, the measure targeted by the Bank of England - also rose, by 3%, putting more money in the public's pockets in the run-up to Christmas. The strongest annual pay growth was in manufacturing, the ONS said, at 6% - perhaps a sign that skilled workers in this key sector are in particular demand.