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Growth in Aberdeen wages is slowest across the UK for eight years

© Supplied by DCT Mediaaberdeen wages
STRUGGLING: The fall in wage increases is attributed to the oil and gas industry downturn in the north-east.

Aberdeen has seen the smallest growth in wages in the UK in the past eight years, new research has revealed.

Granite City workers have seen wages increase just 5.2%, compared to the UK average of 28.1%, according to analysis of official data.

The Shetland Islands have experienced he second smallest wage growth in the UK, with residents seeing a salary a rise of 9.5% in the past eight years,compared to 51% increase for residents of Hackney and Newham in London, areas with the highest salary growth.

The research, by Employment firm Digital ID used new figures from the Office for National Statistics (ONS) to analyse wages for 185 UK areas between July 2014 and December 2021, to discover which regions had the smallest and largest salary increases over the past eight years.

Overall, Britons have seen rises in their pay packets lag behind soaring inflation as the squeeze on households tightens.

Inflation hit a 30-year high last month as prices resisted the traditional tendency to fall in the month after Christmas, with rises affecting food and fuel.

Forecourt fuel prices in the UK hit a record high last week.

According to Digital ID, of the top 15 areas with the slowest wage growths, eight are in Scotland.

Outer Hebrides had the third smallest rise, with workers seeing a wage hike of 14.4% in the last eight years.

Clackmannanshire and Fife, and Caithness and Sunderland and Ross and Cromarty have lagged behind on 18.7% andon 18.9 % respectively.

Angus and Dundee City and the Orkney Islands have also been sluggish with rises of 19.4% and 19.6% respectively since 2014 while Inverness and Nairn and Moray, Badenoch and Strathspey saw salary hikes of just 20.7%.

Paul Gibson, managing director of Banchory-based Granite Financial Planning, said the lag in Aberdeen and Shetland was to be expected as the period covers a time of significant oil and gas price decline.

“The news that Aberdeen and Shetland’s wage growth has been low since 2014 is unsurprising given their local economies do to a great extent depend on strong oil prices,” he said.

“Wage increases prior to the oil price crash were growing at unsustainable levels and a reversion to the mean was inevitable.”

However, he said many who had enjoyed high oil and gas wages were “still exceptionally well off” compared to the UK average and highlighted the widening gulf between the haves and have-nots.

He said the poorest in society were likely to be the ones who are expected to be hardest hit with energy, food and shopping bills rising and a National Insurance hike in April.

“Financial planners tend to work with the wealthiest in society and although wage growth has been slower many clients are still exceptionally well off in comparison to the national average,” he said.

“There is a growing disparity between the richer in society who will invariably have other resources to counteract inflation, such as investment portfolios, whereas those with low or no resources will be hit harder by energy bills and higher inflation in general.”

A spokesperson for Digital ID said: “The UK is facing a serious cost-of-living crisis, from soaring inflation to unmanageable energy bills, and this data reveals just how hard it is for many areas of the country to swallow the costs.

“The stagnant wages in areas such as Aberdeen, South Teesside, Durham and Derby show just how much the decision to increase National Insurance by 1.25 percentage points in April – which actually translates to an average 10% increase in National Insurance – will affect workers who are just trying to provide for their families.

“With the NICs hike affecting employers, too, it is unlikely that many companies will be offering pay rises, and unless something substantial is done to ease the cost-of-living crisis, we will see many more families pushed into poverty

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