Younger retirees could see the full state pension rise to £251.19 a week, a £10.89 increase, after Prime Minister Andy Burnham confirmed the Labour government would keep the Triple Lock. The rise is driven by wage growth data from the Office for National Statistics (ONS) showing total pay grew by 4.1% in the year to June 2026.
Triple Lock Mechanism and Wage Growth
Under the Triple Lock, the state pension increases each year by the highest of September’s inflation figure, 2.5%, or average earnings growth between May and July. This week’s ONS figures showed total pay growth at 4.1% for April to June 2026, outpacing inflation at 2.6%, making wage growth the likely determinant for the next rise.
The current full state pension of £241.30 per week would increase to £251.19, according to calculations based on the ONS data. This would represent a £515 annual increase for those receiving the full amount.
Labour Market Data Shows Softening
The ONS reported that average growth in total earnings, including bonuses, fell to 4.1% in the three months to June, down from 4.3% in the three months to May. City economists had forecast a bigger fall to 4%. Excluding bonuses, regular pay growth ticked up to 3.5% from 3.4%, higher than the 3.4% expected.
Liz McKeown, ONS director of economic statistics, said the data showed “some softening” in the jobs market despite a broadly unchanged overall picture. She added: "Regular wage growth has remained broadly stable in recent months. However, private sector pay growth has continued to ease, while public sector pay growth remains elevated due to the timing of the latest NHS pay awards."
Unemployment and Vacancies
The UK’s unemployment rate remained at 4.9% in the three months to June. Job vacancies continued a downward trend, falling 6,000 to 707,000 in the three months to July.
Felix Feather, economist at Aberdeen, commented: "Today’s labour market figures continue to point to a softening UK jobs market. Regular private-sector pay growth, which is closely watched by Bank of England officials, eased to 2.8% from 2.9% previously. Meanwhile, the more timely indication from PAYE payroll data showed employment fell again, this time by 13,000."
Feather added: "Broadly, the labour market has been loosening for some time. Hiring activity has softened, vacancies have trended lower, and businesses continue to face a challenging demand environment. This underlines our expectation for the Bank of England to be on hold for the rest of the year. Still, we expect inflation will jump at tomorrow’s reading, due to the recent uplift in the energy bill price cap, challenging the impression of domestically generated disinflation reflected in the recent dataflow."
