It’s a busy week for finance and economics in the UK. The top three news stories: faster than expected wage growth, the future of salary payments and PwC hit by second fine.
Wage growth beats market and economist expectations
Data released by the ONS for February to April 2019 shows employment joint-highest on record. Employment levels for the period are 76.1%, higher than a year earlier (75.6%). This included the highest recorded employment rate for women (72%) due to changes in state pension age. The unemployment rate is estimated at 3.8% and has not been lower since October to December 1974. Average weekly earnings (excluding bonuses) increased by 3.4%, before inflation (1.5% after inflation), compared with a year earlier. The biggest increases are in the construction and financial services industries.
Hundreds of thousands of staff to receive salaries before payday
Currently 125,000 UK public sector workers can receive part of their salary as they earn it, instead of waiting until payday. The BBC reports that employers who sign up to the scheme can control limits on withdrawals, ensuring staff receive the bulk of their salary on payday. Employees access an app showing how much they have earned in the current pay cycle and what proportion they can withdraw early. The scheme is designed to help workers avoid high cost credit like payday loans and overdrafts. Scheme provider Wagestream charges employers £1 per employee per month and charges staff a fixed fee of £1.75 each time they make a withdrawal.
PwC receives second fine for audit work by same office
Big four auditor PwC has received a multimillion pound fine as reported by the FT. The fine is the second this year for work conducted by its Leeds office. This has prompted the regulator to strengthen the special monitoring measure for this regional PwC office. PwC has paid a £4.6m fine and two partners responsible who showed “serious lack of competence” were fined £140,000 each. This follows a fine of £6.5m (June 2018) for work on accounts of collapsed retailer BHS also conducted by the Leeds office.