Published: Thu, August 17, 2017
Economy | By Melissa Porter

United Kingdom unemployment falls again to lowest since 1975, wage growth still lacklustre

United Kingdom unemployment falls again to lowest since 1975, wage growth still lacklustre

But the figures on wage growth showed the challenge facing Prime Minister Theresa May and her government, with households feeling the strain of rising prices since last year's Brexit vote.

Looking at public sector employment, there were 5.42 million people employed in the United Kingdom public sector in March 2017 (17 percent), which is 7,000 fewer than in December 2016, 20,000 fewer than year earlier and the lowest since 1999.

Data released by the ONS shows that unemployment in the quarter ending in June was down by 57,000 on the previous three months at 1,484,000. The number of EU-born people working in Britain rose just 1.6 percent year-on-year in the second quarter, the weakest increase in seven years.

The number of people in work in the June rose to 32.1 million, the highest level ever recorded, swelled by an increase in both United Kingdom citizens and foreign nationals finding jobs.

This was higher than the 1.8 per cent City of London analysts had forecast, but well below the latest inflation rate of 2.6 per cent in the year to July.

At 75.1%, the proportion of people in work is the highest it has been since 1971 - partly due to the introduction of a later state pension age for women.

The participation rate rose slightly to 65.1 per cent, meaning more people were in work or looking for it, but the job creation last month was all part-time, with 20,300 full-time positions lost.

It is still slightly behind the United Kingdom rate, which also fell from 4.5% to 4.4%.

After adjusting for price inflation, total pay in real terms dropped by 0.5%, both including and excluding bonuses, compared with a year earlier.

"This is the fourth month in a row where wages have fallen behind the cost of living".

Economists had not expected such strong figures as the economy has grown only at a muted pace this year.

"Separate figures confirm that productivity has been falling throughout 2017 - this matters as rising productivity is the only sustainable route to higher wages and better living standards".

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