The UK’s unemployment rate fell again to its lowest level in over 40 years in June, while wage growth climbed above expectations in an impressive jobs report that has helped push up the pound this morning, FT reports.
Latest official figures for the three months to June show the jobless rate fell from 4.5 per cent to 4.4 per cent – defying expectations of no change and underscoring the country’s impressive job creation since the financial crisis (see chart below).
There are now 1.48m unemployed people in the UK, down 157k over the last year, according to the Office for National Statistics. The jobless rate is also below the Bank of England’s estimate for the natural rate of unemployment.
Average earnings, excluding bonuses, edged up 2.1 per cent from 2 per cent in the previous rolling three months, also ahead of forecasts and the best reading in three months, helping ease some of the pressure on UK workers.
British households have been suffering the worst squeeze on incomes in over two years as the cost of living has climbed above earnings growth this year. Despite the tight labour market, higher wages have been the missing part of the country’s post-crisis recovery.
“Despite the strong jobs picture, however, real earnings continue to decline” said Matt Hughes, senior labour market statistician at the ONS.
The UK’s employment rate also hit another high at 75.1 per cent – the highest since comparable records began in 1971.
A growing proportion of new jobs generated since the crisis have been in flexible employment, including zero hour contracts. The ONS said the these types of jobs – which provide a worker no guarantee of any hours of work – made up 883,000 of all jobs, a drop of 20k over the last 12 months.