New figures from the Office for National Statistics (ONS) have revealed that UK unemployment has fallen to its lowest rate since records began.
In the first quarter of 2017, the number of people not in employment fell by another 64,000 – taking it down to 1.49 million people which is just 4.5% of the population. Naturally, this means that the UK’s employment rate is also at a record high of 74.9%.
These statistics have been a warm welcome at a time when the country has been faced with a lot of uncertainty following Brexit and the General Election. HR Director of Total Jobs, David Clift said that these figures highlight how despite recent political events, the UK job market is particularly strong at the moment. He commented:
“The figures are particularly impressive given that the ONS data covers March-May, a time when General Election campaigning and the sense of instability it caused was nearing its peak.”
The founder and managing director of CV-Library also commented:
“It’s positive to see that the unemployment rate is continuing to drop and it’s clear that businesses across the UK are working hard to strengthen their workforce and keep more people in work.”
Speaking about the website’s own findings, he continued:
“Our own job market data for the second quarter of 2017 has found that advertised job vacancies were up by 1.6% on the first quarter of the year and 14.9% when comparing the data from the same period last year.”
Youth unemployment has also decreased with 12.5% of 16 to 24-year-olds currently without a job compared to 13.5% this time last year. This is a huge improvement compared to late 2011 when youth unemployment was at its highest rate of 22.5%.
One area that remains a concern, particularly for employees, is the fact that wage growth is struggling to keep up with inflation. Excluding bonuses, earnings are currently increasing by 2% year-on-year. In May however, inflation hit an almost four-year high of 2.9%.
Taking this into consideration, it’s hoped that Bank of England officials will think twice about raising interest rates. UK economist at Capital Economics, Paul Hollingsworth commented:
“The continued weakness of wage growth provides some ammunition to the more dovish members of the Monetary Policy Committee (MPC) that now is not the time to raise interest rates. Given that some members of the MPC want to see a clear firming in wage growth before they join others in voting to hike interest rates, we still think it’s more likely than not that the MPC will hold off for a while longer, rather than raise interest rates imminently.”