This should help cushion pensioners from any tax rises announced at the next Budget. RFs proposed 2p switch from NI to income tax would mean £250 extra taxes for pensioners, roughly 1/2 the state pension rise. For the Chancellor’s tax options in full see: www.resolutionfoundation.org/publications...

Finally, today’s revised figures for total pay growth in the 3-months to July (4.8%) will set next year’s state pension increase. We calculate that the new state pension will rise by £576 to £12,582 a year.

But slowing pay growth is bad news for workers. After adjusting for inflation, average weekly pay has increased by a meagre £1.50 over the last 11 months – just about enough to cover the cost of a Greggs sausage roll.

Shorter-term measures suggest an even more rapid slowdown over the summer. Nominal private sector pay growth slowed to annualised rate of 3.5% in the 3-months to August compared to the previous 3-months.

This weakening jobs market is feeding through into pay, something the Bank of England will be reassured to see. Annualised regular nominal pay grew by 4.7% in the 3-months to August – a rate not seen since 2022.

And in further signs of a cooling labour market, we’ve also seen a continued gradual rise in the unemployment rate (where we think the LFS rate is much more accurate), up to 4.8% in the latest data. Vacancies have also fallen for the 39th month in a row.

Combined with population data, we estimate an employment rate of 75.3% in August and 75.2% in September. (The employment *rate* is falling even though jobs aren’t, because the population is growing.) The ONS’ LFS-based rate is also falling, although there are still questions around this data.

The number of payrolled employees has remained steady in recent months, after falling by 127,000 between Oct 2024 and June 2025. Employee jobs rose marginally (by 10k) in August and early estimates suggest they fell back by about the same amount in September.

This unequal geography of ageing in England & Wales represents all sorts of challenges for policymakers. Some areas like Westminster & Lambeth are seeing big drops in primary school-age children, which creates challenges for schools.

More generally, there's been an unequal geography of ageing with the old rural areas ageing fastest.

E.g. today's data shows median age has risen by 5! years in West Devon and Isle of Wight since 2011. 👴 At the same time, Salford and Havering's median age has fallen by 2 years since 2011. 🧒

Why has London aged so fast?

1) London's birth rate has fallen faster than the national trend.
2) International migration has shifted somewhat to other big cities.
3) Londoners are staying put more so than in the past.

London is also the fastest-ageing major city in England & Wales; the capital's median age has risen by 2-years since 2011 compared to falls of 5 months in Bristol & Liverpool.

Lots going on beneath the headline figures. Geographically speaking, London stands out where we find some of the fastest growing (like Barking & Dagenham) and fastest falling populations (e.g. Lambeth).

More timely data up to the end of 2024 (long-term international migration stats) and beyond (visa applications) shows that migration has continued to fall. We can therefore expect population growth to slow in 2025.

As the ONS chart makes clear, recent population growth has virtually all been driven by record international high migration since around 2021.

However, mid-2024 net migration (690k) is down on mid-2023 (830k). (Todays data relates to the middle of 2024).

More generally, there's been an unequal geography of ageing with the old rural areas ageing fastest. E.g. today's data shows median age has risen by 5! years in West Devon and Isle of Wight since 2011. 👴 At the same time, Salford and Havering's median age has fallen by 2 years since 2011. 🧒

Why has London aged so fast?
1) London's birth rate has fallen faster than the national trend.
2) International migration has shifted somewhat to other big cities.
3) Londoners are staying put.

London is also the fastest-ageing major city in England & Wales; the capital's median age has risen by 2-years since 2011 compared to falls of 5 months in Bristol & Liverpool.