Pay rise for Brits as average salary hits £40k

The average UK salary passed £40,000 last month, according to data from the latest UK Job Market Report, suggesting that employers will be prioritising talent recognition this year.

The report, released by job matching platform Adzuna, has found that demand for skilled and motivated staff has pushed salaries up by 7.15% from £37,577 in December 2023, meaning the median UK worker will this year earn an estimated £40,263 per year. 

Last year, we surveyed 531 SMEs about their spending plans for the coming 12 months. Our findings show that just under nine in ten business leaders planned to increase wages this year, suggesting that the new average could rise rapidly in 2025.

UK pay beats inflation

With the rising cost of living still putting strain on UK households, likely few of us would argue we are getting better off. But according to the data, 2024 was a good year for UK pay. 

Last year, official statistics show that pay packets increased by 3.4% between September and November 2024 after inflation, the fastest pace of growth for more than three years.

The new number marks the first time the figure has topped £40k since Adzuna first began publishing its Job Market Report back in 2016. 

It also means the average salary has risen by over £1,000 each year in the past decade. Office for National Statistics (ONS) data shows that iIn 2015, median gross annual earnings for full-time employees was £27,600.

Should bosses be more flexible?

Adzuna analysis says the pay boost reflects a surge in demand for skilled staff, as bosses apparently raise wages in order to entice sought-after roles such as those in tech and AI.

However, it might not be working. The Job Market Report also shows that job openings are now taking more time to fill as bosses struggle to attract the right candidates, with the average duration of job postings having increased from 32.8 days to 34.1 days in December.

While few of us would turn down a raise, research suggests that employees may care less about pay, with many instead having their heads turned by flexible working benefits.

Staff surveys have shown that many UK job hunters would choose working from home over a pay rise, suggesting that offering more niche employee benefits might be more impactful for recruitment drives in 2025.

Shh! Salary transparency on the up

Exclusive survey findings from Startups indicate that 88% of SMEs planned to increase employee wages in 2025, up from 82% last year. 

Some workers could see big windfalls. 15% of business leaders told us they planned to increase wages by 11%. For most, though, the bonus is likely to be smaller. One third of businesses told us they will up wages by 5% this year, the most popular response overall.

Employers seem to be shy about sharing these wage hikes with new hires, however. Adzuna’s research also shows that 2024 was the worst year on record for salary transparency, with 54% of jobs ads choosing to hide salary information from candidates.

Clearly advertising salary can be attractive to job seekers as it suggests that the company is confident that their published offer is competitive. However, it can cause resentment if clear salary bands have not been established with existing employees.

It might not all be deliberate. Many job seekers have spotted an alarming trend towards AI in recruitment which has led to a growing number of poor quality job specs being published. According to an iHire survey, only 48.6% of employers now think their job ads are effective.

CEO salaries continue to rise

Pay might be rising quickly for UK employees, but it would have to skyrocket in order to compete with average wage rises for the country’s top-earners.

CEO salaries have been climbing upwards at a record rate over the past few years. Analysis from the High Pay Centre has found that by midday on 6 January, the UK’s top chief executives had already out-earned the median worker’s salary for the whole of 2025.

Median FTSE 100 CEO pay currently stands at £4.22 million, which means it is now around 104x higher than the average salary presented by Adzuna.