Reducing the impact of poverty
Growth in median annual pay
Overall, there was zero nominal pay growth for Coventry residents in work in 2019, full time average annual pay fell narrowly during 2019. Rates of employment amongst residents continued to increase during 2019 but average pay is not increasing overall, and this pay data gives a counterbalance to the apparently positive picture of the labour market given by total employment numbers. While the data suggests that increases in employment amongst residents have been greater in ‘higher skilled’ types of occupations, overall average pay did not increase in that period - this may indicate limited growth in pay across all types of jobs.
Pay growth amongst Coventry residents in employment is worse than the average elsewhere; Coventry’s lack of growth (-0.1%) compares to average pay growth across England of 2.7% and it increased by 2.4% across the West Midlands region on average. Average annual pay for Coventry residents in full-time employment is still lower than the national average but slightly higher than the West Midlands regional average. Despite the lack of growth in Coventry, average annual full-time pay is still above average compared to similar local authority areas. In 2019 there was zero average nominal pay growth amongst all full-time workers from Coventry while average prices continued to rise, albeit moderately. The UK annual inflation rate ran at between 1.5% and 2.0% so for some Coventry residents in employment real incomes were falling. To consider the effect on overall household incomes, the fact real earnings may have fallen a little should be balanced against the fact that an increasing proportion of Coventry residents are in employment. On the other hand, welfare payments to those out-of-work have fallen. Historically the average earnings amongst all Coventry residents in work have been consistently lower than the average pay by workplaces located in the city; on average commuters into Coventry get paid more. This remains and the gap had not been closing in recent years.
Gender pay gap
Gross disposable household income (GDHI)
Gross Disposable Household Income (GDHI) broadly measures the amount of Coventry’s GVA that benefits households, the money generated that becomes income for people. Coventry has a low average annual GDHI per head amongst residents. At £15,355 per head Coventry’s is notably (about £3,000) less than that of the West Midlands region, and less than that of England (about £6,250). Coventry’s residents have significantly less to spend or save after income distribution measures (including taxes, social contributions, and benefits) have taken effect. GDHI is still low but growth in 2018 was relatively good. Total GDHI, at £5.631 billion, increased by 4.3% in 2018, a similar rate of increase to the England average (5.3%). GDHI per head grew as well, but by less than the national average, 2.4% compared to 4.6% annual growth for England, this is because the total population growth in Coventry in 2018 was at one of the highest rates in the country. It is significant that GVA from Coventry’s businesses did not grow in 2018 but GDHI, the household income that results, grew quite well - so while the growth in the local economy was starting to look brittle in 2018, the outcomes for residents remained relatively healthy. However, we can see from another data source (median full-time earnings) that the following year, 2019, saw low growth in earnings from employment - so such growth in household income may not sustain. While GDHI per head grew faster than GVA per head this year, it remains notable that GVA per head in Coventry is higher than the average for a group of similar local authorities, but it is lower than the same group for GDHI per head. This points to relatively low average income being a particular issue for Coventry. A relatively low amount of the value created by Coventry businesses helps local households as income. Coventry is a population centre; the city’s population has been growing strongly for several years and the city is home to 2 successful universities and so is home to many full-time higher education students. These reasons are partly why this measure of household income is relatively low.