Employment growth continues in three months to July – ONS
The latest employment figures show another healthy increase in the number of people in work. The Office for National Statistics reported that employment rose by 174,000 in the three months to July, with the unemployment rate unchanged at 4.9%.
The claimant count, which is calculated for August, found there were 771,000 people claiming unemployment related benefits, up from 763,600 in July.
Wage growth did slow down with the ONS reporting a fall to 2.1% in the three months to July, from a revised 2.4% a month ago. When bonuses are added to the wage total, earnings rose by 2.3% during the quarter, down from 2.5%.
Economists had differing views as to the impact of Brexit on the jobs outlook. James Knightley, UK economist at ING Financial Markets, was more cautious saying “the employment figures have held up well despite Brexit because the data is a rolling three-month figure. It includes numbers for May and June, ahead of the referendum, which most corporates expected to result in the UK staying in the European Union. We have to remember that it also takes time for businesses to react to shock outcomes like the Brexit vote.”
Alan Clarke, an economist at Scotia Bank, was more upbeat, arguing that the broader recovery in the economy bode well for the labour market. “It is business as usual after the referendum. Firms have not stopped hiring. Blaming the slower wage numbers on Brexit is putting the cart before the horse because the wage data lags [other measures of the economy’s health] by a considerable margin,” he said.
Average regular pay (excluding bonuses) was £472 per week, up from £463 per week a year earlier. Analysts said the decline in wages growth was likely to further delay any increase in interest rates, though in the short term the stability of the labour market would mean policymakers were under little pressure to cut further.