Growth in take home pay rose 1.3 per cent in the three months to August compared to just 0.8 per cent in the quarter ending in July, the VocaLink Take Home Pay index will show today.
However, with CPI standing at 3.1 per cent in July, pay growth is still dwarfed by inflation.
Over the three months to August, services pay growth doubled to 1.2 per cent but annual manufacturing pay growth fell to 2.3 per cent.
Marion King, chief executive officer at VocaLink, said: “While the gap between take home pay and inflation has narrowed, the difference remains high by historical standards. This is tough on households as take home pay growth lags nearly two percentage points behind the rise in the cost of essential goods and services.”