UK employment rate reaches new high

The UK employment rate hit a new, record high of 76.5% in the final quarter of last year, defying predictions of a Brexit-induced slump.

Graph illustrating an article about the UK jobs market
In the quarter to January, the Office for National Statistics (ONS) recorded a rise of 7,000 in the number of vacancies, pushing the total to an estimated 810,000 - lower than a year earlier but still high by historical standards.The ONS said that in Q4 last year, a record 32.93 million people were employed. "There was a 180,000 increase in employment on the quarter. This was, again, mainly driven by quarterly increases for full-time workers (up 203,000 – the largest increase since March to May 2014), and for women (up 150,000 – the largest increase since February to April 2014)."Meanwhile, annual growth in average weekly earnings slowed to 2.9% this month, compared to 3.2% in January. After adjusting for inflation, annual growth in total pay, including bonuses, was estimated to be 1.4%, while growth in regular pay was put at 1.8%.

Office for National Statistics: Employment rate reaches a "record high"

Myrto Miltiadou, ONS deputy head of labour market statistics, said, "Employment has continued its upward trend, with the rate nudging up to another record high. In particular, the number of women working full-time grew strongly over the past year."In real terms, regular earnings have finally risen above the level seen in early 2008, but pay including bonuses is still below its pre-downturn peak."In the quarter to December, the unemployed total fell by 16,000 to 1.29 million. The ONS also recorded the largest increase in EU-born workers in the UK since March 2017, rising by 133,000 to 2.44 million.

UK Minister for Employment comments on the latest employment figures

Minister for Employment Mims Davies said, "As we embark on a new chapter as an independent nation outside the EU, we do so with a record-breaking jobs market and business confidence on the rise."With wages still outpacing inflation, UK workers can expect their money to go further as we look ahead to a decade of renewal."The upcoming Budget will steer us on that course, further driving our levelling-up agenda, so we can all share in the country's prosperity."

Confederation of British Industry: Employment growth tempered by slowing pay growth

Alpesh Paleja, lead economist at the Confederation of British Industry (CBI), commented, "Employment has risen strongly again - and it’s great to see the number of vacancies rising, showing a growing appetite for hiring. Yet the strength in employment continues to be tempered by slowing pay growth and lacklustre productivity.“By unlocking investment in skills, unleashing spending on innovation and pressing ahead with HS2, the upcoming Budget presents a golden opportunity to boost the UK’s long-term growth potential.”

British Chambers of Commerce: strong UK jobs figures mask underlying economic problems

Suren Thiru, head of economics at the British Chambers of Commerce, added, “The jobs market remains remarkably robust, with employment levels rising despite the UK economy stalling at the end of last year.“However, the strong headline figures mask underlying problems. Lingering economic uncertainty has often led to companies hiring staff to fill orders rather than investing in new technology, weakening productivity.“Slowing wage growth is a concern as it could trigger a broader slowdown in household spending, a major driver of UK economic growth. A weak economy, low productivity and high employment costs are limiting increases in pay settlements.“The forthcoming Budget must take steps to close the skills gap, with more funding for vocational and technical education and improved flexibility for the Apprenticeship Levy to better meet business needs.”

Read more news and views from David Sapsted

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