UK employment at record high despite Brexit

Despite the Brexit uncertainty companies increase their hiring adding 473,000 jobs over the last year, the lowest jobless rate since 1975.

Two workers shake hands
The number of people employed in the UK has hit a record high while the jobless rate is at its lowest for 44 years, according to official data published on Tuesday.

Employment rate hits a record high

The Office for National Statistics (ONS) said that, in the quarter to January, the number in work rose to 32.7 million, 473,000 higher than a year earlier and the highest figure since records began in 1971.Meanwhile, the number unemployed fell by 35,000 to 1.34 million, 112,000 lower than a year ago, representing a jobless rate of 3.9 per cent, the lowest since early 1975 and considerably below the 6.5 per cent unemployment rate across the European Union.The number of job vacancies increased by 4,000 to 854,000 while, simultaneously, the number of economically inactive people fell by 117,000 to 8.55 million, a rate of just over 20 per cent which, again, was the lowest on record.ONS data also showed average earnings increased by 3.4 per cent in the year to January, 1.5 per cent ahead of the inflation rate.

Government cite pro-business policies with delivering record employment

Matt Hughes, senior ONS statistician, said, "The employment rate has reached a new record high, while the proportion of people who are neither working nor looking for a job - the so-called 'economic inactivity rate'- is at a new record low."Employment Minister Alok Sharma commented, “Today’s employment figures are further evidence of the strong economy the Chancellor detailed in last week’s spring statement, showing how our pro-business policies are delivering record employment.“2019 has continued to be a record breaker, with the employment rate topping 76 per cent for the first time, record female employment and unemployment falling below four per cent for the first time in 44 years.“Our jobs market remains resilient as we see more people than ever before benefiting from earning a wage. By backing the government’s Brexit deal and giving certainty to business, MPs have the chance to safeguard this jobs track record.”

No-sign that Brexit has hurt labour market

Andrew Wishart, UK economist at Capital Economics said there was no sign that Brexit-related concerns had hurt the labour market."It is surprising that the labour market has remained so strong while economic growth has eased. Indeed, annual employment growth of 1.6 per cent is above growth in the economy of 1.4 per cent, implying that output per worker (productivity) is falling," he said.Tej Parikh, senior economist at the Institute of Directors, said, “Businesses have been steadfast in bringing on board new staff and in creating vacancies, despite question marks over the future path of the economy. Meanwhile, as unemployment has fallen, competition for a shrinking pool of workers has pushed up salaries and buoyed households.

Shrinking investments indicates the economy is close to capacity

“But with uncertainty around Brexit reaching a crescendo, firms are becoming more and more cagey over their hiring decisions."Mike Jakeman, senior economist at PwC, added, "It might seem difficult to balance positive jobs and wage data with the fact that business investment has been shrinking for several quarters."It may be that demand in the economy is close to capacity, which is generating demand for new workers, but firms are reticent about committing to major expansion plans until more is known about Brexit."Enter the 2019 Relocate Awards in-text bannerSubscribe to Relocate Extra, our monthly newsletter, to get all the latest international assignments and global mobility news.Relocate’s new Global Mobility Toolkit provides free information, practical advice and support for HR, global mobility managers and global teams operating overseas.Global Mobility Toolkit download factsheets resource centreAccess hundreds of global services and suppliers in our Online Directory

Related Articles