UK employment hits another record high

Commuters in a railway station

The number of people in work in the UK has continued to climb, with a record 32.6 million employed between October and December, latest figures from the Office for National Statistics show.

Unemployment was little-changed in the three-month period at 1.36 million.

Average earnings increased by 3.4% in the year to December, unchanged from the previous month.

The news follows January’s inflation figures, which fell to a two-year lowthanks to lower energy bills and fuel.

Graph of employment figures

The number of people in work between October and December was up 167,000 from the previous quarter and 444,000 higher than at the same time in 2017.

The employment rate – defined as the proportion of people aged from 16 to 64 who are working – was estimated at 75.8%, higher than the 75.2% from a year earlier and the joint-highest figure since comparable estimates began in 1971.

The unemployment rate was unchanged at 4%, which is its lowest since the December 1974 to February 1975 period.

ONS deputy head of labour market Matt Hughes said: “The labour market remains robust, with the employment rate remaining at a record high and vacancies reaching a new record level.

“The unemployment rate has also fallen, and for women has dropped below 4% for the first time ever.”

Graph of unemployment figures

However, Andrew Wishart, UK economist at Capital Economics, warned that next month’s figures may not be so buoyant.

“The labour market data didn’t reflect the slip in hiring surveys in December, with employment rising,” he said.

“However, the surveys deteriorated more markedly in January, so a Brexit effect might start to weaken employment growth in the next batch of official data.”

Presentational grey line

Analysis:

By Dharshini David, BBC economics correspondent

The jobs market remains in a robust shape despite the loss of momentum in the economy towards the end of last year – although the Brexit fog effect may be yet to register.

Continuing recent trends, the majority of those entering work were previously inactive (students, looking after home, long-term sick etc).

The demand for labour continues to bolster wage growth. Real wages increased by more than 1% per year, better on the whole than in recent years although about half the rate of the pre-crisis era.

So little sign of Brexit uncertainty hitting hiring so far – but demand in the labour market tends to lag significantly behind changes in output.

More recent employment surveys show a marked deterioration in January, so a Brexit effect might start to weaken employment growth in the next batch of official data.

And productivity – output per hour – was down by 0.2% in the fourth quarter of 2018 versus a year previously, as output rose more slowly than employment. The lack of progress in this area could weigh on wage growth in the longer term.

[“source=bbc”]

 

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