Sunday, 23 September, 2018

United Kingdom unemployment hit record high as earnings increase 2.5%

United Kingdom unemployment hit record high as earnings increase 2.5% United Kingdom unemployment hit record high as earnings increase 2.5%
Nellie Chapman | 25 January, 2018, 07:24

Official figures released today show that the employment rate is at a joint record high of 75.3%, with a record 32.2 million people in work.

Sterling touched $1.41, its highest level against the US dollar since the 2016 Brexit vote, and British government bond prices sank to their lowest level since October after Wednesday's stronger-than-expected headline figures.

The unemployment rate remained at 4.3% for the sixth successive month, but the number of people in work increased by 102,000 when it had been forecast to drop.

Overall, the figures went some way to alleviating worries that Britain's labour market was running out of steam after a couple of months in which employment fell slightly. The latest rate matched economists' expectations.

The ONS said workers' earnings, excluding bonuses, rose by an annual 2.4 percent in the three months to November, the biggest increase since December 2016 and compared with 2.3 percent in the three months to October.

The employment rate is 72.7%, an increase on the previous three months but below the United Kingdom average of 75.3%.

Including bonuses, earnings grew 2.5 percent.

The Office for National Statistics (ONS) said the United Kingdom employment rate is now at a joint record high of 75.3%. In November, headline inflation was 3.1 percent.

Job vacancies also hit record levels, up 17,000 to 810,000.

Chris Williamson, chief business economist at IHS Markit, said the figures showed the United Kingdom labour market displayed signs of strength late a year ago, with employment rising and pay growth "creeping higher".

Brettell added that with pay growing at 2.5% but inflation running at 3%, the squeeze on real wages continues for the ninth consecutive month.

Unemployment over the three months came in at 4.3%, down from 4.8% for a year earlier.

The latest labor market figures provided further reassurance that the economy held up in the fourth quarter of past year, Paul Hollingsworth, an economist at Capital Economics, said.

"But the number of job vacancies also hit a record high, signalling that employment could increase further before an imbalance of supply and demand starts to push wages up at a more meaningful pace".

"That's why we've increased the National Living Wage, introduced Universal Credit to offer greater flexibility and taken millions of people out of income tax altogether by raising the tax-free personal allowance".