LONDON, Oct 20 (Reuters) - British workers have seen another small rise in the pace of pay growth and there were other signs of a small recovery in the jobs market, according to data which could bolster the case for a Bank of England interest rate hike next month.
Average weekly earnings, excluding bonuses, grew by 3.7% in the three months to August compared with the same period in 2025, the Office for National Statistics said, extending a gradual pickup since touching a low of 3.4% earlier this year.
A Reuters poll of economists had pointed to a weaker increase of 3.6%. The figure for the three months to July was revised up slightly to show a rise of 3.6%.
A preliminary measure of payrolled employees from Britain's tax office rose by 13,000 in the month of September. The change for August was revised to show a rise of 1,000 compared with a provisional estimate of a decline of 26,000.
The unemployment rate - which is derived from a survey that the ONS is overhauling - dropped to 4.7% in the three months to August, its lowest since mid-2025.
Sterling rose against the U.S. dollar after the data was published.
The BoE is looking for signs that the Iran war energy price shock is turning into broader inflation pressure in the economy including through demands for higher pay.
There were some signs in Tuesday's data that suggested the jobs market remains weak.
Job vacancies in the three months to September fell to 691,000 from 704,000 in the three months to August, the first time it went below 700,000 since the three months to April 2021.
(Writing by William Schomberg, editing by Sam Tabahriti and Suban Abdulla)
