Around 24,000 staff members at British Airways can look forward to a significant pay increase of more than 13% over the next 18 months, beginning in September, according to an announcement by the Unite union. The deal, reached after months of negotiations, also includes a one-off payment of £1,000 for the workers. However, pilots and management are not part of this agreement.
The pay rise and one-off payment aim to address the impact of high inflation on workers in various sectors. In the UK, inflation has remained persistently high, running at 7.9%, well above the Bank of England’s target of 2%. The deal negotiated by Unite also reverses pay cuts implemented in 2020.
Shifting the focus to the U.S. economy, job growth in July maintained a moderate pace, with 187,000 jobs added, according to the Labor Department’s employment report. Although this figure slightly missed economists’ expectations, it still reflects the ongoing tightness in labor market conditions. The unemployment rate dropped to 3.5%, the lowest since over 50 years ago, indicating a continued recovery in the job market.
While some areas, such as leisure and hospitality, are still below pre-pandemic employment levels, companies are holding onto their workers due to the challenges in finding labor during the COVID-19 pandemic. Despite the recent moderation in job growth, the labor market remains tight, aligning with the Federal Reserve’s prediction that the unemployment rate could reach 4.1% by the end of this year.
