With government figures showing a rise in UK unemployment and a slowing of pay growth, wage pressures are likely to stay subdued over the winter, the Chartered Institute of Personnel and Development (CIPD) has predicted.
A report from the organisation said that a rise in the number of home-grown workers and immigrants entering the jobs market meant that the labour pool was growing faster than labour demand, so unemployment was set to rise for some time to come.
The growth in the number of workers available was down to both high levels of immigration and the growing number of older workers, according to the CIPD, which is likely to have been boosted by the recent introduction of age discrimination legislation.
Office of National Statistics figures showed that growth in UK salaries was failing to keep up with growth in the cost of living as measured by the Retail Price Index.
Growing levels of unemployment meant that employers could resist workers' demands for higher pay, even in relatively buoyant private sector services, the report noted.
While the news relieved concern about the outlook for inflation, the continued squeeze on living standards when people were living with high levels of debt could cause trouble for the economy next year, the report warned.
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