United Kingdom unemployment remains at 4.2%

Irving Hamilton
July 19, 2018

"But the fuel on which the labour market runs - people wanting to get into work - is getting scarcer".

The latest figures from the Office for National Statistics (ONS) have shown that the UK's employment rate has reached a record high of 75.7%, up from 74.9% a year earlier.

Looking ahead, the GBP/USD exchange rate may tick higher on Wednesday as the United Kingdom publishes its latest CPI figures.

Unemployment remained at 4.2pc, the Office for National Statistics said. This was almost 400,000 higher than the same period a year earlier.

But he added: "It is important to remember that unemployment remains, by historical standards, at a low rate".

As employment rose, unemployment fell, with 12,000 fewer people out of work than in the previous period, the ONS said.

The number of vacancies rose to the highest since records began in 2001 and inactivity - those neither in work nor looking for a job - dropped by 86,000 to a record low of 21%.

The number of Scots out of work is on the rise, while falling across the rest of the United Kingdom, official figures today show.

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Average earnings increased by 2.5% in the year to May, compared with 2.4% the previous month.

"Looking in more detail, the data suggest that there has been something of a shift away from self-employment over the past year, with all the employment growth coming from people working as employees".

"Importantly, it's good see that wages are continuing to outpace inflation".

"Real earnings remain modestly up on the year, both including and excluding bonuses", Hughes said in his statement.

Ben Brettell, a senior economist at Hargreaves Lansdown, said in an email shortly after the data was released: "All in all these numbers don't alter the economic picture of anemic growth, a relatively tight labour market and under-control inflation".

Tuesday's numbers are likely to have helped that cause, according to Andrew Wishart, a United Kingdom economist at Capital Economics.

However, wage growth slipped slightly to 2.7% from 2.8% over the period.

Dollars investors will be looking for any guidance on the path of U.S. interest rates in the coming months and are likely to be particularly focused on whether the recent escalation in trade tensions could prompt some caution from the Fed.

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