Figures by the Office for National Statistics showed the employment rate at a record high
The unemployment rate in the UK has been steady at a near 11-year low of 4.9% in the three months to August. According to the Office for National Statistics (ONS), unemployment edged up by 10,000 to 1.6million, despite the employment rate being at a record high of 74.5%.
The statistics revealed that there were 8.81 million people aged from 16 to 64 who were economically inactive (not working and not seeking or available to work), 65,000 fewer than for March to May 2016 and 231,000 less than for a year earlier. Employment has been up by 106,000 – the highest since 1971. The ONS stated that the figures cover two months after Britain’s vote to leave the EU.
ONS statistician Nick Palmer said: 'These figures show that employment continued to grow over the summer and vacancies remain at high levels, suggesting continuing confidence in the economy.
'While there was also a small rise in the headline unemployment level, that was accompanied by more people actively seeking work.'
Yet, despite the steady figures, predictions suggest there will be a pay squeeze to follow. Acting chief economist, Ian Brinkley at CIPD believes that although the overall unemployment rate remains stable, there has been a decrease in the number of people classified as economically inactive who say they want a job. He said: 'It is still too early to read any Brexit impact into these figures, as they only cover the period to August. Any future impact is more likely to show up through a gradual slowdown, rather than a dramatic decline, as employers become more cautious about hiring.
“Regular pay has remained stable, with average weekly earnings increasing by 2.3 percent comparing the last three months with the same three months a year ago. However, as inflation is widely expected to exceed two percent next year as the impact of the pound's devaluation feeds through into prices, we could be heading for another period of very low or negative real wage increases for many workers.”
Additionally, John Salt, group sales director, totaljobs also commented and explained that there is more to do. “In the face of plenty of turmoil surrounding the fall of the pound, the ONS figures continue to provide a reassuring perspective on the state of the economy.
“However, there are still quite a few red flags that must be navigated. A number of businesses have made high-profile job loss announcements in the last couple of weeks, while a number of others are still warning that they may need to move jobs elsewhere. It will fall on the Government to continue to support businesses of all sizes so that they can keep on hiring, and keep the job market on this positive trajectory.”
Source: Office for National Statistics (ONS)