In the three month period between August and October 2015, the number of people out of work fell by 110,000 and the total figure now stands at 1.71 million. There are 31.3 million people in work which is more than half a million more compared to this time last year.
Michael Martins, an Economic Analyst at the Institute of Directors commented:
“The employment rate is at its highest ever level, the unemployment rate is down to its lowest level since well before the crash at 5.2% and youth unemployment which is always a tricky problem to solve, continues to fall impressively. All of this indicates that we are closing in on full employment.”
The figures have also revealed that the number of EU citizens working in the UK has increased by 324,000 to 2.02 million and workers who are neither EU nationals or Britons remains largely unchanged at 1.20 million.
Although pay grew at its slowest rate since the January to March period, overall, total pay has gone up by 2.4%. This means that even though earnings from August to October has increased at a slower rate than other periods in the year, it’s still continuing to grow in real terms.
What exactly does this mean for wages and inflation over the next 12 months? The Governor of the Bank of England has said that he would like to see earnings growth at about 3% a year before he increases interest rates and a tightening labour market should mean wage rises. Although this was a trend that was witnessed in 2015, a concern is that wage growth outpaced productivity for much of 2015 and as a result, in the last few months, pay increases trailed off.
Other figures which were release by the ONS at the same time revealed that there are currently 747,000 vacancies which is the highest the UK jobs market has seen since data began in 2001. The number of hours worked per week has also hit record figures as it reached one billion for the first time. This was a consequence of more people who are currently in work as average weekly working hours per person has remained relatively unchanged.
If you would like help finding a new job in 2016 then please feel free to contact Choralis Consulting and we will be more than happy to help. Alternatively, if you are looking to recruit high quality finance professionals into your team, again, we will be more than happy to assist.