Northern Ireland’s Median Pay Drops £28 Amid Rising Employment Challenges

The latest labour market figures reveal that the average employee in Northern Ireland experienced a decline in median pay by £28 in June 2025, bringing the total to £2,344. These statistics, released by the Northern Ireland Statistics and Research Agency (Nisra), highlight ongoing challenges within the region’s economy despite a stable level of employment.

According to data from HMRC PAYE, there were 809,200 registered employees in Northern Ireland last month. This figure reflects a relatively stable employment landscape, yet the 2.1% unemployment rate reported for the quarter from March to May 2025 marks a significant increase of 0.6% compared to previous figures.

Work Hours and Economic Inactivity Rates Increase

The labour market statistics also indicate that a total of 30.2 million weekly hours of work were performed in June, which represents a 4.2% rise from the previous quarter and a 2.9% increase compared to the same period in 2024. However, the economic inactivity rate now stands at 26.3%, up by 0.4% over the past year. This rate measures the percentage of individuals aged 16 to 64 who are neither employed nor actively seeking work.

In June alone, there were 300 redundancies, contributing to a total of 2,160 redundancies in the last twelve months. This figure represents a decrease from 2,560 recorded during the previous year. Furthermore, 210 proposed redundancies were announced in June, pushing the annual total to 3,030, which is nearly 5% higher than the previous year’s total of 2,890.

Inflation’s Impact on Employment and Wages

The current unemployment and redundancy figures come on the heels of an unexpected rise in the Consumer Price Index (CPI) inflation rate, which increased to 3.6% in June, up from 3.4%. Mark McAllister, the chief executive of the Labour Relations Agency, commented on the situation, stating that the combination of rising inflation and redundancy announcements could lead to increased tensions during upcoming pay negotiations.

“This makes for a challenging combination, especially with pending pay negotiations and the potential for pay-related disputes,” McAllister noted. He expressed concern about the increasing number of redundancies compared to the previous year, emphasizing the financial struggles faced by both employees and employers.

Jenny Rankin, an associate and employment expert at DWF Law in Belfast, offered insight into the mixed nature of the latest labour market figures. She highlighted that while formal employment and wage growth are positive indicators, the rising economic inactivity suggests a cooling job market. Rankin stated, “With food prices rising and UK inflation taking an unexpected hike, employees are likely to seek higher wages simply because it costs more to live.”

As employees grapple with heightened living costs, Rankin suggested that if employers are unable to meet increased wage demands, there may be notable shifts in the job market as workers pursue better-paying opportunities elsewhere. This dynamic contributes to the ongoing uncertainty in Northern Ireland’s labour market, as both economic conditions and employee expectations evolve.

The data paints a picture of a region facing significant economic challenges, emphasizing the need for continued attention and action to support both employment stability and fair wage growth.