Economists were rejoicing this past week at the news that UK wage growth grew at its fastest rate for six years in November, according to a leading national survey.
A survey which was carried out by both KPMG and the Recruitment and Employment Federation (REF) found that starting salaries in November 2013 stood at their highest rate since November 2007. Many financial analysts have seen the news as particularly positive in the build-up to Christmas considering all of the extra financial muscle that the period traditionally brings.
But what does this news really mean?
The most important aspect of this news is that it is the latest indicator that the UK economy is moving in the right direction as it returns to growth.
The unemployment rate has also fallen recently and steady growth has been visible within the UK economy in the last year. The coalition government have regularly been criticised for the austerity measures which they have imposed upon the public since coming to power.
However, recent events suggest that things are now moving in the right direction and this is obviously good news with Christmas just around the corner. This period is a traditionally strong one for retailers across the UK as they seek to entice shoppers.
Could Christmas provide another step in the right direction?
A particularly strong showing from the retail sector during this month could be the latest boost to the government’s economic plans as we head into 2014.
It is always a prosperous period which has a knock-on effect for the wider economy. For example, stores across the UK will be in need of temporary staff for the busy Christmas period, which subsequently will have an effect on employment levels.
If the same temporary employees are then spending more money over the Christmas period then the economy will benefit from the extra contribution and everyone involved will begin to see the genuine value of the whole Christmas period.
Some leading financial analysts have altered interest rate predictions based on the recent spate of positive news, with some even suggesting a revised date of December 2014 for the month that interest rates finally begin to move in the right direction.
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