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UK jobs data: CIPD says time now for skills investment

18 July 2018

The unemployment rate, defined by the Office for National Statistics as the number of unemployed people as a proportion of all employed and unemployed people, was 4.2%. This measure is down from 4.5% on the same period last year and the joint lowest since 1975.

The number of unemployed people (people not in work but seeking and available to work) declined to 1.41 million – 12,000 fewer than for December 2017 to February 2018 and 84,000 fewer than for a year earlier.

Are UK wages rising or falling?

Headline findings also showed a slight year-on-year increase in real wages.

Growth was 0.4% excluding bonuses, and by 0.2% including bonuses. Average weekly earnings, not adjusted for price inflation, increased by 2.7% excluding bonuses, and by 2.5% including bonuses, compared with a year earlier.

Will the latest jobs data impact the interest rate decision?

Anna Leach, business representative body the CBI’s head of economic intelligence, said that while the labour market “continues to confound expectations of a slowdown,” pay growth has slipped to a six-month low. “This leaves the MPC’s decision on a knife-edge when it meets to set interest rates in a couple of weeks’ time.”

Ian Brinkley, acting chief economist for the CIPD, the professional body for HR and people development, also pointed out that much of the jobs growth war for part-time work, which saw total hours worked in the economy falling slightly.

“The labour market continues to deliver on jobs, but there are a number of underlying weaknesses,” said Mr Brinkley. “It looks as if employers have been coping with recent weak growth by offering more jobs with fewer hours. If and when GDP growth revives later this year, we might expect more full-time employment.

“Wage growth – comparing regular pay over the last three months with the same three months of last year – has started to slacken,” continued Mr Brinkley. “Real wages continue to rise, but this owes more to the continued fall in inflation rather than any improvement in wages.


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