Wages vs inflation: What is your salary worth?

We look at the average salary figures in the UK and whether wages have grown in line with inflation.

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By

Matthew Boyle

&

Matteo Pennarts

Updated

Fact checked

Your salary affects your daily living costs and how much money you can put away in savings accounts, so we looked at the latest salary statistics to find out how our salaries have changed over the years and how wages compare to inflation.

Quick overview

  • The average UK salary is £32,760 in April 2023, an increase of £823.33 from 2022.
  • Real wages have only grown by 3% since 2015, whilst nominal wages have grown by 31% in the same period.
  • Between 2021 and 2023, real wages have gone down by almost 5%.
  • The highest earning region in 2022 was London, with an average salary of £44,070.
  • Londoners earn £11,315 more a year than the second highest earning region in the UK.
  • 40 to 49 year olds have the highest average salary at £37,247.
  • The sector with the highest average salary in the UK is finance and business services, with an average salary of £44,200.
  • The private sector’s bonus pay is 1,250% of the public sector’s pay, on average.
  • The gender pay gap in the UK is about 14% in 2023, widening from 2.2% in the youngest age group to 19% in the oldest age group.

What is the average salary in the UK?

The average salary in the UK is £32,760 as of April 2023, an increase of £823.33 from 2022. In the ten years since 2013, average salaries have increased by around 35%. The biggest year-on-year change in salaries since 2000 happened in 2022, when average salaries grew by 6%, likely due to the high inflation levels.

2009 was the only year since 2000 where the average salary decreased year-on-year. It was 0.1% lower than in 2008.

Year Average salary UK (total pay)
2000 £16,289.00
2001 £17,138.33
2002 £17,680.00
2003 £18,252.00
2004 £19,036.33
2005 £19,916.00
2006 £20,843.33
2007 £21,870.33
2008 £22,646.00
2009 £22,620.00
2010 £23,109.67
2011 £23,638.33
2012 £23,946.00
2013 £24,210.33
2014 £24,479.00
2015 £25,068.33
2016 £25,666.33
2017 £26,251.33
2018 £27,027.00
2019 £27,950.00
2020 £28,444.00
2021 £30,129.67
2022 £31,936.67
2023 £32,760.00

What is the average salary per month?

The average monthly salary in the UK is £2,730 as of April 2023. The private sector’s average monthly salary is slightly higher than the public sector’s, coming in at £2,743 and £2,682.33, respectively.

Wages vs inflation: Are wages actually rising?

Wages adjusted for inflation, known as real wages, have been fairly stable in the UK, growing by around 3% since 2015. However, between 2021 and 2023, real wages have gone down by almost 5%, meaning our salaries are not rising in line with inflation.

Nominal salaries have grown steadily over the last 8 years, rising from £25,068 in 2015 to £32,760 in 2023. This difference represents a 31% increase in 8 years.

To understand whether wages are actually rising in line with current prices, we’ve compared real income with nominal income. While nominal income is the actual amount of money paid, as discussed in the salary figures above, real income is adjusted for inflation.

Year Real wages (in 2015 £'s) Nominal Wages(in 2015 £'s)
2015 £25,107.33 £25,068.33
2016 £25,549.33 £25,666.33
2017 £25,462.67 £26,251.33
2018 £25,566.67 £27,027.00
2019 £25,987.00 £27,950.00
2020 £26,221.00 £28,444.00
2021 £27,074.67 £30,129.67
2022 £26,325.00 £31,936.67
2023 £25,740.00 £32,760.00

What is the average UK salary by age?

The average salary increases with age, reaching a peak between 40 and 49 years old, at £37,247 in 2022. However, age groups from 50 onwards earn less, with the average salary falling to £27,128 for 60+ year olds. The lowest earning adults are 18-21 year olds, earning only £14,118 on average.

Age group Average salary (2022)
16-17 £6,162.00
18-21 £14,118.00
22-29 £27,632.80
30-39 £34,866.00
40-49 £37,247.60
50-59 £35,094.80
60+ £27,128.40

What is the average UK salary by region?

The highest earning region in 2022 was London, with an average salary of £44,070, which was £11,315 more than the second highest earners in the South East. The region with the lowest average earnings was the North East with £28,293.

Region Average Salary (2022)
North East £28,293.20
North West £30,248.40
Yorkshire and The Humber £28,470.00
East Midlands £28,974.40
West Midlands £30,451.20
East £30,737.20
London £44,070.00
South East £32,754.80
South West £29,364.40
Wales £28,511.60
Scotland £31,049.20
Northern Ireland £29,546.40

What is the average UK salary by industry?

The sector with the highest average salary in the UK is finance and business services, with an average salary of £44,200 as of April 2023. This sector earns £6,968 more than the next highest sector, which is construction (£37,232). The manufacturing sector comes in third, with an average salary of £35,984.

The lowest average salary is in the wholesale, retail, hotel and restaurant sector, with an average salary of £21,684. This sector’s average salary is £10,296 less than the second-lowest earning sector, which is the public sector (£31,980).

Industry Average salary in 2023
Services £32,136.00
Finance and business services £44,200.00
Public sector (excluding financial services) £31,980.00
Manufacturing £35,984.00
Construction £37,232.00
Wholesaling, retailing, hotels & restaurants £21,684.00

Public sectors vs private sector salaries in the UK

The average salary in the private sector is slightly higher than the public sector, at £32,916 and £32,188, respectively. However, the public sector earns more in regular pay on average. The private sector benefits overall by having a significantly higher share of bonus pay on average.

The average bonus pay for the private sector is £2,600, compared to only £208 for the public sector. This means the private sector’s bonus pay is 1250% of the public sector’s pay, on average.

Sector Total Pay Regular pay Bonus pay
Whole economy £32,760.00 £30,628.00 £2,184.00
Private sector £32,916.00 £30,316.00 £2,600.00
Public sector £32,188.00 £32,136.00 £208.00

What is the gender pay gap in 2023?

On average, it is estimated that the gender pay gap in the UK is about 14% in 2023. The gender pay gap widens with age, as 18 to 21 year olds are estimated to have a 2.2% gender pay gap, whereas 60+ year olds have an estimated gender pay gap of 19%.

This difference may reflect a change in policy and attitude in younger generations. However, it may also indicate a compounding effect within the gender pay disparity.

2022 Gender Pay Gap
All employees 13.90%
18-21 2.20%
22-29 4.60%
30-39 9.90%
40-49 16.80%
50-59 18.10%
60+ 19.00%

Sources used

  • ONS
Click here for more research. For all media enquiries, please contact:

Matt Mckenna
Head of UK communications
T: +44 20 8191 8806
matt.mckenna@finder.com@MichHutchison/in/matthewmckenna2

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