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UK wage growth slowed to its lowest level in almost three years in the three months to July amid a weakening jobs market. Data from the Office for National Statistics shows annual average total earnings growth for the private sector was 4.8 per cent between May and July 2024. The last time growth was lower was in the three months to November 2021, when it was 4.6 per cent.
The ONS also found that the estimated number of vacancies in the UK decreased by 42,000 to 857,000 in June to August 2024. Vacancies decreased in the quarter for the 26th consecutive period but are still above pre-Covid levels. Payrolled employment also fell by 6,000 in July, compared to June, and 59,000 in August, although it rose by 203,000 between July 2023 and July 2024.
The health of the jobs market, including wages, is one of the key considerations for the Bank of England’s monetary policy committee when considering the interest rate level. The nine members of the committee are due to meet next Thursday but are widely expected to leave the rate at 5 per cent.
There is some other interesting information on the state of the labour market from Indeed that suggests the labour market is tipping back in favour of employers. Its senior economist Jack Kennedy says there has been a dip in the share of remote and hybrid job postings, a sign, he says of “employers perhaps acceding less to worker preferences for flexibility.
The share of job postings that mention flexibility was 14.4 per cent in August, down from a peak of 16.4 per cent in January, although this is still up on pre-pandemic levels.
There is evidence companies are cracking down on flexibility. Santander became the latest firm to require office-based staff in the UK to be in the office three days a week on average, up from two days at present. This matches PwC, which last week ordered staff to spend more time in the office and meeting clients in person.
Business Agenda
A summary of the most important business news
1. A House of Lords committee has sent a stark warning to the prime minister Sir Keir Starmer that he must raise taxes or rein in the state. The Lords’ economic affairs committee said in a report that not doing so would risk putting Britain “on a path to unsustainable debt” that could trigger Liz Truss-style market crises. You can read more here.
2. Apple has unveiled the new iPhone, which has a focus on generative AI that Tim Cook says “pushes the boundaries of what a smartphone can do”. However, the manufacturer has been wrapped on the knuckles by the EU for pushing tax boundaries. The company has been told to pay back €13bn (£11bn) in unpaid taxes to Ireland by the European Court of Justice. You can read more about the new iPhone here and the EU tax case here.
3. Online platforms have overtaken TV channels as the most popular sources for news in the UK, according to Ofcom figures. More than seven in 10 UK adults (71 per cent) consume online news, said the UK’s communications regulator, slightly ahead of TV, which is used by 70 per cent of adults. The survey also found that 52 per cent of UK adults use social media for news, up from 47 per cent in 2023. You can read more here.
4. Energy industry regulator Ofgem has demanded a “culture change” in the industry. Energy suppliers have been told to dramatically improve their customer service or face tough intervention, amid complaints about long call waiting times and billing problems. The regulator, which was criticised for allowing the conditions that led to the failures, said it had “set a clear and ambitious benchmark for the energy sector to be the best for customer service, setting the standard for other sectors”. You can read more here.
5. PrettyLittleThing founder Umar Kamani is returning to the fast-fashion retailer as he vows to make the brand special again. He stepped down as CEO last April, although his new job title hasn’t been revealed. One of Kamani’s first actions is reported to be scrapping a fee for returns only three months after it was introduced. He said he will also be reviewing “some of the more drastic changes made in recent times” and will focus on “prioritising customer needs, ensuring that every decision reflects their best interests”. You can read more here.
Business Question
Who am I?
- I was born on this day in 1964
- I failed my university entrance exam twice
- An internet search for “beer” was the inspiration for my global company
- The company I founded now has the SoftBank touch
- I have many inspirational quotes including: Making money is easy, spending it is hard
The answer can be found at the bottom of the page.
Business Thinker
Deep dives on business and leadership
By Sarah Vizard
We have a focus on leadership for today’s Business Thinker.
⏳ The ‘Rule of Saint Benedict’: A medieval blueprint for modern time management
Oliver Burkeman is a British author and journalist who previously wrote the weekly ‘This Column Will Change Your Life’ column for The Guardian before publishing his book Four Thousand Weeks: Time Management for Mortals. In this piece, he looks back at the life of St. Benedict of Nursia, who established the Rule of Saint Benedict, which emphasises moderation, work and prayer. It has lessons for modern business leaders, he believes.
🎯 How to remain in Founder Mode as your company scales
The notion of ‘founder mode’ and ‘manager mode’ as two distinct leadership models is reasonably well known. In this article for Sifted, Olio CEO Tessa Clarke talks about her company’s transition from Olio 1.0, in which they were firmly in founder mode, to Olio 2.0, in which they switched to manager mode, and then Olio 3.0, where it adopted a more grown-up version of founder mode.
😰 Incoming Starbucks CEO’s tall order: Calming anxious employees
Brian Niccol started his new job as Starbucks CEO yesterday and he has a big job to do. Same-store sales are shrinking and its stock price has been falling. To turn the company around, he will need to fix its operations, attract a younger customer and improve innovation. But he will also need to win over staff. This article from the Wall Street Journal looks at how.
Business Quote
Inspiration from leaders
“You create opportunities by performing, not complaining.”
– Muriel Siebert
Business Leader
The best of our content
Marketing masterclass: How Serie A is taking on the Premier League
In the 1980s and the 1990s, Serie A was the best football league in the world. The Italian league was where players wanted to play and what fans wanted to watch. Diego Maradona, Marco van Basten and Roberto Baggio were superstars and playing in Serie A.
But in recent years that has not been the case. Serie A has been overtaken by other leagues, notably the English Premier League. Now, however, Serie A is fighting back.
In this episode of the Business Leader podcast, Michele Ciccarese, the commercial and marketing director of Serie A, explains how.
You can listen here or wherever you get your podcasts.
Other popular pieces
🛒 Building B&M: Speed, strategy and success
💡 How to preserve tacit knowledge
And finally…
Family vlogging: have you come across this very modern phenomenon?
Over the past decade, more and more families have been turning their lives into soap operas. Platforms like YouTube and TikTok have made it much easier to reach mass audiences. Filming has also become easier.
And it turns out many people want a window into regular family life (even though it is meant to be private and arguably it’s healthier to keep it that way). So, there’s an audience.
For some families who have opened up, it has transformed their fortunes. The Independent has this interesting story of the rise and fall of one vlogging family, the Michalaks.
They turned their fly-on-the-wall family vlog into a successful operation that netted enough advertising and sponsorship for it to become their main income. At the height of their fame, they earned just over £100,000 a month and were able to buy a £1m home in the UK.
They hit their peak in 2016, but now they find the market is “saturated” with rival creators and deals are harder to come by. So, they are ‘downsizing’ to Portugal to a nice villa with a pool. Probably a nice backdrop for the next series of their family vlog, if anyone’s still interested.
You can read the story here.
The answer to today’s Business Question is Jack Ma.
